What is CVD? Cumulative volume delta for Bitcoin
Originally published on swiftedge.uk . Swiftedge makes free browser tools for live Bitcoin and Ethereum order flow. Cumulative volume delta, or CVD, is a running total of aggressive buying minus aggressive selling . It answers a simple question: since the start of the day, have traders who cross the spread been mostly buying or mostly selling? This guide explains how it is built, how to read it…
Cumulative volume delta (CVD) is a metric used in live Bitcoin and Ethereum order flow to measure the balance between aggressive buying and aggressive selling since the start of the trading day. CVD is calculated by taking the difference between taker buy volume and taker sell volume for each trade, and then summing these deltas over time.
The resulting value represents the cumulative net volume of aggressive orders. In Swiftedge's Depth chart, CVD is displayed as a yellow line over the volume bars, with a label indicating the value at the right edge of the view. The depth chart computes CVD from every trade on Binance's BTCUSDT perpetual futures contract, using the exchange's own flags to determine which side was the aggressor.
The data shows a strong correlation between CVD and price movement, with a correlation coefficient of 0.75 between an hour's delta and the price change in that hour, and 77% of hours showing the same direction for both. However, CVD does not have predictive power for future price movements, as the correlation between delta and the next hour's price change is close to zero (0.002).
Some traders use CVD to identify absorption, where aggressive buyers are filled by passive sellers in the form of walls of resting sell orders visible in the order book heatmap. This absorption can provide insights into market dynamics, but does not guarantee future price actions.
Written by urgent.news from Dev.to's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
