Cumulative Delta

Definition ∞ Cumulative delta measures the continuous difference between buying and selling pressure in a market over time. This metric aggregates the net order flow, specifically the volume traded at the ask price minus the volume traded at the bid price, to show sustained directional pressure. A positive cumulative delta indicates a dominance of market buys, while a negative value signifies prevalent market sells. It offers a precise visualization of aggressive order execution, revealing underlying market sentiment beyond simple price changes.
Context ∞ Traders and analysts frequently reference cumulative delta in news reports to assess the strength of price movements and identify potential reversals in digital asset markets. Observing divergences between price action and cumulative delta can provide early signals of weakening trends or impending shifts. This indicator helps contextualize market volatility by highlighting the intensity of buying or selling activity.