Definition
Cumulative Delta
Cumulative delta tracks the running difference between aggressive buy and sell volume to reveal who is in control intraday.
By tallying volume executed at the ask (aggressive buying) minus volume at the bid (aggressive selling), cumulative delta builds a line showing net buying or selling pressure through the session. A rising cumulative delta signals buyers in control; a falling one signals sellers. Divergence from price hints at hidden absorption.
Indian intraday and F&O traders use cumulative delta on liquid Nifty and Bank Nifty contracts as part of order flow analysis to confirm moves and catch reversals. It is most reliable on high-liquidity instruments where the bid-ask classification of trades is meaningful.
Related terms
- DivergenceDivergence occurs when price and an indicator like RSI or MACD move in opposite directions, warning of a possible reversal.
- Order Flow / Tape ReadingOrder flow analysis reads live buy and sell orders, the depth, and executed trades to gauge short-term supply and demand.
- Volume ProfileA volume profile shows how traded volume is distributed across price levels or across the trading day, used to anticipate liquidity and to design execution schedules.
Plain-English explainer from The Dispatch Investors Encyclopedia. General information, not financial advice.