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Analysing Gold Delta Divergence


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Analysing Gold Delta Divergence

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  #1 (permalink)
Cardiff, UK
 
 
Posts: 30 since Oct 2020
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Can anyone give me some pointers how to correctly analyse the delta divergence seen here on GC.

Is this a good technique for predicting direction on GC? From what I can see here there is no way of correctly analysing this. However I am new to this type indicator.

Any help appreciated. Cheers

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  #2 (permalink)
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Dazzc View Post
Can anyone give me some pointers how to correctly analyse the delta divergence seen here on GC.

Is this a good technique for predicting direction on GC? From what I can see here there is no way of correctly analysing this. However I am new to this type indicator.

Any help appreciated. Cheers

I have found this article for you:
https://www.orderflowtrading.de/en/cumulative-delta-simply-explained/
perhaps it will help.

I don't have my thinking cap on at the moment, so if you need more use the @ and ask and I'll think on your question more.

Here are some thoughts to consider:
  • your trading time horizon - you will need to match the time period of the bars and delta accumulation to that.
  • try plotting the momentum indicator and see how it interplays with cum delta and the price.
  • try testing on a chart with clear price trend reversals and focus on what is happening with the indicators at turns (peaks and troughs).

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  #3 (permalink)
Cardiff, UK
 
 
Posts: 30 since Oct 2020
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Thanks Aquarian for the link & Info.

I suppose the main concept I'm struggling with is if the delta is suggesting 1.absorption or 2. a level of interest level from the market buyer/seller.

For example, in the attached picture, the pullback in the trend down is suggesting positive delta but the price is flat, does this suggest that there is buying interest or could it be that there is absorption from the sellers of market buyers and the price will continue down?.

In this case the price reversed and the former is true however as far as I can tell, at least in this example, there is no way of predicting which way this pullback is going to go.

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  #4 (permalink)
Cardiff, UK
 
 
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@aquarian1 any thoughts if its not to much trouble.

Am I using to low a timeframe for this type of analysis?

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  #5 (permalink)
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Dazzc View Post
@aquarian1 any thoughts if its not to much trouble.

Am I using to low a timeframe for this type of analysis?

Sent using the futures.io mobile app

Hi Dazzc,
I've re-read your first post and the one above. (I do not use delta or cumulative delta myself.)

here is a thread which may be of help



and perhaps reading it and asking them would be more advantageous to you.

In your first post you ask if the cum delta was good for predicting price movement in GC. Studying your chart of the first post it does not seem to be. Remember that indicators should only be used to the extent that they help you. (no help - don't use them).

It may be that cum delta is only useful is very special situations.

I could not make out your second image very well and not the timeframe but to your question of too low a timeframe I would imagine delta must be used at a very low timeframe to give info (and perhaps only in a divergence or confirmation sense) but once again refer to threads here at fio by people that use delta in their trading.
Best of luck.

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  #6 (permalink)
Cardiff, UK
 
 
Posts: 30 since Oct 2020
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aquarian1 View Post
Hi Dazzc,
I've re-read your first post and the one above. (I do not use delta or cumulative delta myself.)

here is a thread which may be of help



and perhaps reading it and asking them would be more advantageous to you.

In your first post you ask if the cum delta was good for predicting price movement in GC. Studying your chart of the first post it does not seem to be. Remember that indicators should only be used to the extent that they help you. (no help - don't use them).

It may be that cum delta is only useful is very special situations.

I could not make out your second image very well and not the timeframe but to your question of too low a timeframe I would imagine delta must be used at a very low timeframe to give info (and perhaps only in a divergence or confirmation sense) but once again refer to threads here at fio by people that use delta in their trading.
Best of luck.

Thanks aquarian1 I'm checking it out.

Also for other people stumbling upon this thread there is another which features some good info re: c.delta.
https://futures.io/traders-hideout/52154-understanding-footprint-charts-number-bars.html

Cheers

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