Change In State of Delivery (CISD): What It Is & How It Works

A Change In State of Delivery represents a central shift in how price is being delivered to the market.

When we talk about What is Change in State of Delivery, is when buying power starts beating selling pressure, or when the opposite happens instead.

Think of it this way: if price has been moving downward through a series of bearish candles, that's bearish delivery. The CISD happens when a candle closes above where that bearish movement started, indicating that sellers have lost control and buyers are stepping in.

This change in state of delivery originated from the Inner Circle Trader (ICT) methodology and focuses specifically on the opening and closing prices of candles, ignoring the wicks entirely.

That's what makes it unique, because you will be looking at the body of candles to determine delivery direction.

The main idea is straightforward: A bearish sequence begins delivering bullishly when price closes above its starting point, and a bullish sequence begins delivering bearishly when price closes below where it began.

How to Identify Bullish and Bearish State of Delivery

Identifying CISD patterns requires understanding market structure and carefully observing the behavior around key levels. Let's break down both types with clear identification steps.

Bullish CISD Identification

To identify a bullish CISD, begin by confirming that the market is clearly in a downtrend, characterized by a sequence of a High (H), followed by a Low (L), then a Lower High (LH) and a Lower Low (LL).

Then pinpoint major support zones, like broader timeframe bottoms from earlier days, weeks, or months, since they tend to cluster stop losses.

Watch until price briefly drops under such a level but swiftly moves back above it, suggesting a likely order sweep instead of real downward momentum.

Lastly, identify the starting price of the latest downward move. When price shuts clearly over this point, it confirms a bullish CISD pattern, meaning momentum may now favor buyers, raising chances for upward movement ahead.

Bearish CISD Identification

A bearish CISD mirrors the bullish pattern but in reverse. Start by confirming an uptrend structure: Low (L), High (H), Higher Low (HL), Higher High (HH), that shows bullish price delivery.

Mark key high levels from recent timeframes where liquidity accumulates above the market. Watch for price to sweep above one of these highs, triggering buy stops and breakout traders, before quickly reversing lower.

Identify the opening price of the candle or candle series that started the most recent bullish leg. When price closes below this opening level, you've confirmed a bearish CISD.

This formation indicates that buying momentum has faded and sellers are stepping in to control price direction.

How to trade with CISD

Using CISD effectively means treating it as a confirmation tool, not a standalone entry signal. After identifying a CISD, look for convergence with other price action concepts to build a higher-probability setup.

A bullish CISD favors long opportunities, while a bearish CISD points to short bias. One effective method is combining CISD with fair value gaps, waiting for price to retrace into the imbalance created after the CISD before entering with defined risk-reward.

The same logic applies to bearish setups. CISD can also be paired with order blocks, as the candles preceding the shift in delivery often act as institutional levels, offering clear entries and invalidation points.

Another effective strategy involves using CISD across multiple timeframes:

1. Identify CISD on higher timeframes (4H or Daily) for directional bias
2. Drop to lower timeframes (15-min or 1-hour) for precise entries
3. Look for CISD on the lower timeframe that aligns with the higher timeframe direction
4. Enter with confluence from FVGs, order blocks, or liquidity sweeps

Differences between CISD and CHoCH

Many traders confuse change in state of delivery trading with Change of Character (CHoCH), but understanding their differences is crucial for proper application.

Core Focus Differences

CISD checks how strong price moves are by seeing whether candle closings exceed earlier opening levels. This shows changes in momentum during delivery periods.

CHoCH, by contrast, looks at shifts in market structure. While it follows broader movements, its main role is spotting when prices move beyond key swing points - this signals a change in trend direction. Instead of minor fluctuations, it emphasizes breakouts past prior extremes, which validate reversals within the framework.

Confirmation Requirements

A CISD signals clearly if the price shuts past the start point of prior counter-trend bars. It may occur quickly, occasionally after only a few ticks.

CHoCH happens when price moves past a key swing level, such as a prior peak during a decline or a trough in a rise, and closes beyond it.

The process demands time because it depends on more substantial momentum shifts. Movement must be precise, not just brief fluctuations near the level.

Timing and Early Signals

CISD typically forms much earlier than CHoCH because it doesn't wait for significant structural breaks. This makes the change in state of delivery of ICT example patterns excellent for early entries, but also means they can produce more false signals.

CHoCH forms after significant structure breaks, providing more reliable confirmation but often resulting in less favorable entry prices since part of the move has already occurred.

Practical Application

In real trading, experts usually combine all these ideas. While CISD signals possible turnarounds ahead of time, giving a chance to get ready or enter early, yet it’s only when CHoCH shows a clear shift through price structure that confirmation comes.

Imagine CISD as a signal that comes first, while CHoCH acts like proof of structure. When used together, one gives timing, the other adds trust through validation.

Key Elements of Change in State of Delivery

Several critical elements determine whether a CISD pattern will lead to successful trades or false signals. Understanding these components helps you filter quality setups from noise.

Liquidity Levels

The most important element in change in state of delivery concept is liquidity. CISD patterns work best when they occur at significant liquidity zones, that are areas where stop-loss orders cluster.

These include:

• Previous session, daily, weekly, or monthly highs and lows
• Equal highs or equal lows that have been tested multiple times
• Major psychological price levels
• Areas with visible accumulation of orders

When CISD forms after sweeping these liquidity zones, it indicates that smart money has collected the liquidity needed for their positions and is now reversing price direction.

Opening Price Identification

Correctly identifying which opening price to monitor is crucial. You need to pinpoint the candle (or candle sequence) that initiated the most recent delivery phase.

For a bearish sequence, find where the downward delivery began. For a bullish sequence, identify where the upward movement started.

Timeframe Considerations

CISD works across all timeframes, but higher timeframes typically provide more reliable signals.

However, lower timeframes are valuable for precise entries after identifying CISD on higher timeframes. Using a multi-timeframe approach combines reliability with precision timing.

Market Context

Always consider the broader market context. A CISD forming during strong trending conditions has different implications than one forming in choppy, range-bound markets.

In trending markets, CISD patterns that align with the overall trend (continuation patterns) tend to be more reliable.

Confluence Factors

Never trade CISD in isolation. The strongest setups occur when CISD aligns with:

• Order blocks at institutional levels
• Fair value gaps creating retracement opportunities
• Liquidity sweeps showing smart money activity
• Support and resistance zones from higher timeframes

The more confluence factors present, the higher your probability of success with CISD-based trades.

Conclusion

Change in state of delivery provides traders with a powerful tool for identifying momentum shifts before they become obvious to the broader market.

By focusing on the opening and closing prices of delivery sequences rather than just swing points, CISD offers early warning signals that can significantly improve your trading timing.

With patience and proper application, CISD can become a valuable addition to your price action trading toolkit.