Price , Open Interest (OI) & Dbars (CVD Line chart)

Indicators = story fragments.

  • The general colour/shape (session aggregate) gives you bias.
  • The individual candles / spikes / deltas give you the execution story (whoโ€™s hitting whom right now).
    You must read both together, and always combine price action + footprint + volume + OI to infer whether moves are initiations, covers, or absorption.

Price , Open Interest (OI) & Dbars (CVD Line chart)

Core concepts (short, exact)

  1. Open Interest (OI)
    • Up = more positions opened (new longs or new shorts).
    • Down = positions closed (longs or shorts being closed/covered).
    • Combine OI change with price change to infer which side:
      • Price โ†‘ + OI โ†‘ โ†’ new longs (buyers initiating).
      • Price โ†‘ + OI โ†“ โ†’ shorts covering (rally on cover).
      • Price โ†“ + OI โ†‘ โ†’ new shorts (sellers initiating).
      • Price โ†“ + OI โ†“ โ†’ longs closing / stop-hunts (liquidation/covering).
  2. CVD / Delta / DBars (net aggressive taker flow)
    • Measures aggressive trades (market takers). Positive delta = buyers aggressive; negative = sellers aggressive.
    • Spikes in delta show bursts of taker aggression โ€” those are the โ€œwho pressed the buttonโ€ moments.
  3. Footprint / Volume profile
    • Shows where volume and delta happened at price levels. Use it to detect absorption: lots of buy volume at a price that doesn’t push price higher โ†’ sellers absorbing.
  4. Session aggregates vs individual bars
    • Session aggregate (green/red zone) = bias for that session.
    • Individual bars & spikes = micro-structure / immediate intent.

How to read OI + Price + DBars together โ€” 8 practical scenarios (and what to do)

Iโ€™ll use short labels: P = price, OI = open interest, ฮ” = delta/DBars.

  1. P โ†‘ / OI โ†‘ / ฮ” โ†‘
    • Interpretation: Real buying demand โ€” new longs. Trend likely genuine.
    • Action: Donโ€™t fade; look for long continuation or wait for pullback to join.
  2. P โ†‘ / OI โ†“ / ฮ” โ†‘ (or flat)
    • Interpretation: Price rally largely on short covering (ฮ” may still show buys if buyers step in). Weak structural demand.
    • Action: Be cautious to buy โ€” this is a cover-rally, likely to fail unless follow-through.
  3. P โ†“ / OI โ†‘ / ฮ” โ†“
    • Interpretation: Initiation of new shorts โ€” sellers are aggressive. Good structural short scenario.
    • Action: Look to join shorts on confirmation; stops above recent high / liquidity.
  4. P โ†“ / OI โ†“ / ฮ” โ†“ (or flat)
    • Interpretation: Longs being closed or stops getting taken โ€” not necessarily aggressive new shorts. Could be profit taking or liquidation.
    • Action: If youโ€™re short, donโ€™t assume new strong sellers โ€” price may chop or reverse. Watch for absorption bars.
  5. Delta spike negative while price holds / OI flat or rising
    • Interpretation: Aggressive selling met by passive bids = absorption (sellers hitting bids, but buyers absorbing). Thatโ€™s often a bottoming sign.
    • Action: Wait for follow-through; fading selling can be profitable if confirmed with footprint showing big bid-side resting volume.
  6. Delta spike positive while price stalls / OI flat or rising
    • Interpretation: Aggressive buying being absorbed โ€” sellers defending a level (potential fake breakout).
    • Action: Donโ€™t trust the move until footprint / volume clears โ€” it can be a trap.
  7. OI jumps but ฮ” small / price flat
    • Interpretation: Options/futures large position add or passive limits added โ€” could be institutionally hedging / opening big positions without immediate market impact. Watch the level.
    • Action: Mark the level โ€” itโ€™s likely defended later.
  8. At session open: ฮ” flips green but cumulative OI from prior session still high to the side
    • Interpretation: Session open can show fresh delta but yesterdayโ€™s positions still exist; new session aggregation can mask residual pressure.
    • Action: Anchor previous sessionโ€™s OI/CVD โ€” donโ€™t treat session-reset as positions evaporating.

Individual candles/spikes vs general colour โ€” when to trust each

  • Trust spikes/individual bars when:
    • They are large relative to recent average volume/delta (i.e., meaningful participation).
    • They occur at a clear structural level (POC, VWAP, profile extreme, sell/buy tail).
    • Footprint shows imbalanced trades (one side executed far more).
  • Trust the general colour / session aggregate when:
    • Itโ€™s persistent across many bars (shows sustained flow).
    • You want the bias for longer intraday trades (trend direction).

Rule of thumb: If session bias and a high-impact spike agree โ†’ high-confidence trade. If they disagree โ†’ wait, reduce size, or use partial entries and tight manage.


Detecting absorption vs initiation (practical footprint cues)

  • Absorption (buyers absorbing sells):
    • Large negative delta spikes on lower ticks but price fails to move down or quickly recovers.
    • Footprint shows high traded volume on the bid side at that price level.
    • OI may not increase much (because the aggressors are being matched by passive liquidity).
  • Initiation (sellers initiating):
    • Negative delta spike and price moves lower with follow-through and OI increases.
    • Footprint shows aggressive taker prints removing resting bids.

Session resets โ€” how to prevent being โ€œfooledโ€ (practical setup & rules)

  1. Always run a continuous / multi-session OI & CVD alongside session-based versions.
    • If your platform lets you set โ€œaggregate across daysโ€ or โ€œrollingโ€, enable that. If not, duplicate indicators and anchor one manually to yesterdayโ€™s close.
  2. Mark yesterdayโ€™s extremes and the location of big OI / big delta activity (horizontal lines) โ€” those are future liquidity magnets.
  3. At session open behavior rule:
    • If yesterday showed heavy seller initiation (price down + OI up + negative CVD), treat new-session green deltas with suspicion for at least the first 10โ€“30 minutes โ€” wait for two confirming bars before flipping bias.
  4. If indicators โ€œflipโ€ exactly at session open, check the continuous OI/CVD: if the continuous view still shows yesterdayโ€™s accumulation, bias remains.

Live trade decision checklist (use this before entering or exiting)

  1. Price location: structural level? (POC, VPOC, VWAP, tail)
  2. Price vs OI: which of the 4 combos above? (map it)
  3. Delta/DBars: are there aggressive spikes? absorption?
  4. Footprint: who is on the tape at that price level? (bid/ask imbalance)
  5. Session context: is the session aggregate backing your read?
  6. Risk controls: worst-case stop, partial size if indicators conflict.
  7. Journal tag: record which signal forced your entry/exit (for later review).

Practical management rules for conflicting signals

  • Conflict at entry time: halve the size or wait for a 2-bar confirmation.
  • If youโ€™re already in and indicators flip: trim size (take off half), move stop to break-even, wait for a re-confirmation.
  • If OI increases strongly against your position while delta supports that increase (e.g., you shorted, OI rises and price rises) โ€” reduce exposure immediately; thatโ€™s new participants opening against you.

Quick mastery drills (do these daily for 2โ€“4 weeks)

  1. Replay sessions: pick 10 sessions, label every big move with (price change, OI change, ฮ” change) and write the interpretation.
  2. Journal trades: every trade, log the 7-point checklist above. After a week, categorize misses by the combo that fooled you.
  3. Spot absorption: find 5 bars where a spike was absorbed โ€” mark footprints and learn the visual signature.
  4. Backtest patterns: take the 8 scenarios above โ€” measure how often price followed through within 15/30/60 mins.

Quick cheat-sheet

  1. Price โ†‘ / OI โ†‘ = new longs (follow)
  2. Price โ†‘ / OI โ†“ = short cover (fade)
  3. Price โ†“ / OI โ†‘ = new shorts (follow)
  4. Price โ†“ / OI โ†“ = longs closing/liquidation (cautious)
  5. Delta spike + price stall = absorption (flip probability โ†‘)
  6. Session open flip w/out continuous confirmation = wait

SIMPLE WORKFLOW TO TRADE

Price , Open Interest (OI) & Dbars (CVD Line chart)

1. Your Anchor: RektV

  • โœ… You already noticed it โ†’ RektV is your sharpest reversal/pullback signal (because it shows real liquidations).
  • Rule: Never fade RektV alone. Always check if OI/CVD/DBars agree.

2. What each tool is really good for (keep it simple)

  • OI (Open Interest) = tells you if new positions are being built or old ones closed.
  • CVD line = shows aggressive takers โ†’ momentum.
  • DBars:
    • Session reset = intraday bias only.
    • Full data mode = long-term sentiment (yes! youโ€™ll see if across multiple sessions the pressure is mostly buyers or sellers).

๐Ÿ‘‰ So yes, running DBars on full data = big-picture sentiment (bullish/bearish bias). Running DBars on session mode = intraday flow.


3. Why multiple liquidations happen before a real reversal

Thatโ€™s normal.

  • Liquidations = stops being run.
  • Market often clears multiple liquidity pockets before reversing.
  • Your edge is: donโ€™t call the first liquidation a reversal โ†’ wait for confirmation in OI/CVD/DBars.

4. Simplest 3-Step Workflow for You

Hereโ€™s the exact loop Iโ€™d suggest:

  1. Bias (use full data DBars + OI trend):
    • DBars full data โ†’ overall buyers vs sellers.
    • OI trend (growing = active positioning, falling = closing).
    • Mark bullish or bearish bias for the day.
  2. Trigger (use RektV + CVD spikes):
    • Watch RektV liquidations.
    • Check if CVD spike agrees (aggressive buying/selling after the liquidations).
  3. Confirm (mini-checklist before entry):
    • Is OI moving in the same direction as price? (new positioning, not just a squeeze)
    • Is DBars session color aligned with your bias?
    • If yes โ†’ take the trade.
    • If no โ†’ pass, or reduce size.

5. Rule for liquidations & reversals

  • First liquidation = caution. Could be just clearing weak hands.
  • Second/third liquidation with absorption (price not breaking lower/higher) = thatโ€™s your real reversal zone.
  • Confirmation: CVD slows or flips + OI flat = positions washed out, reversal likely.

6. Timeframe for each tool (so you donโ€™t overthink)

  • RektV = use on your entry timeframe (3m).
  • OI & DBars (session) = intraday guide.
  • OI & DBars (full data) = higher timeframe sentiment (bullish or bearish mood).
  • CVD line = quick pulse check โ†’ whoโ€™s pushing right now.
Price , Open Interest (OI) & Dbars (CVD Line chart)

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