Measure the aggression.

Delta

Delta measures the difference between aggressive buying and aggressive selling over a defined period.

DELTA = AGGRESSIVE BUY VOLUME − AGGRESSIVE SELL VOLUME

Positive delta indicates greater aggressive buying. Negative delta indicates greater aggressive selling.

Positive delta does NOT automatically mean price should go higher. Negative delta does NOT automatically mean price should go lower. Location and price response matter.

Example: price reaches upper EXT. Delta becomes strongly positive. Buyers are clearly aggressive. But price cannot advance. That can be more interesting than positive delta accompanied by efficient upward price movement.

CVD — Cumulative Volume Delta

CVD accumulates delta over time and helps visualize changes in aggressive participation across the session. Traders compare price against CVD.

Price higher + CVD higher

→ Aggression broadly supporting movement.

Price higher + CVD failing to confirm

→ Potential divergence or weakening participation.

Price lower + CVD lower

→ Selling aggression broadly supporting movement.

Price lower + CVD improving

→ Potential deterioration in selling pressure.

FATBOOK Rule

DIVERGENCE IS EVIDENCE. NOT AN ENTRY SIGNAL.

At EXT, FATBOOK can use delta/CVD to determine whether the participants attacking the extreme are strengthening, weakening, being absorbed, or beginning to lose control.

Next: the flagship setup built entirely on this evidence.

Continue to Model 1: Rotation →

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