medium · Order Flow Analysis footprint-delta

During an uptrend, three successive footprint bars print rising prices but a sequence of cumulative-delta values of +900, +350, +90 — each new price high accompanied by a smaller delta than the prior high. The bid/ask spread has not widened.

Which conclusion is most defensible?

  1. Diminishing buy-side aggression is required to lift price to each new high, a delta/price divergence warning that initiative buying is waning even as price holds
  2. Falling delta with rising price on its own means sellers have now become the aggressors, so the trend has already reversed and shorts are favored right now
  3. The smaller deltas simply mean order-book liquidity has thinned out considerably at each level, so each new high is actually more reliable and the uptrend keeps accelerating
  4. Cumulative delta must always climb in strict lockstep with rising price throughout any healthy trend structure, so this dataset is corrupted and must be discarded

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