Core terms
- Aggressor — the side of a trade that crossed the spread to execute immediately; the taker.
- Taker — a trader who removes liquidity by hitting a resting order. The side order-flow analysis measures.
- Maker — a trader who provides liquidity with a resting limit order and waits to be filled.
- Delta — buy volume minus sell volume; the imbalance between aggressive buyers and sellers.
- Net delta — delta totalled over a chosen window, in dollars.
- CVD (Cumulative Volume Delta) — a running, never-resetting total of delta plotted over time.
- Buy ratio — the share of taker volume that was buying; above 50% means buyers were more aggressive.
Market structure
- Spot — the market where actual Bitcoin changes hands.
- Perp / Futures — perpetual futures; leveraged derivatives with no settlement date.
- Funding rate — periodic payment between perp longs and shorts that tethers perp price to spot.
- Venue — an exchange. Grouped here into Major (deep liquidity) and Minor (smaller) tiers.
- Liquidity — resting orders available to trade against; deeper liquidity absorbs aggression with less price impact.
- Divergence — when two measures (price and CVD, or spot and futures) point in different directions.
- VWAP — volume-weighted average price; the average fill price weighted by trade size.
Reading states
- Both Buying / Both Selling — spot and futures lean the same way; the strongest aligned signals.
- Divergent — spot and futures disagree; resolution tends toward the spot side.
- Balanced — no clear lean either side; treat as no-signal.
- Confluence — several independent signals agreeing at once; the real edge, and still a probability, not a promise.