Market Depth Cumulative

The Market Depth Cumulative Indicator also includes the Market Depth Cumulative Difference Indicator.  These indicators keep track of the total bid – offer difference throughout the trading day.

These indicators can track order book trends during the trading day and track any potential inefficiencies in the market with a visual display of the imbalance.  An efficient market will typically show a “balanced” order book. The Market Depth Cumulative indicators can spot imbalances which serve as inflection points for an acceleration of the current trend or a turning point for a reversal trade. As traders we like to identify and track these inefficiencies in the market. Market inefficiencies can show up in the order book when the order book becomes “imbalanced”.

This indicator can be used on any futures market and requires Level II data. It can also be used on any timeframe as it tracks information based on a closed bar basis so 1 tick to 1 minute timeframes are recommended.