A system and method are disclosed for detecting angular displacement of a display element relative to a reference position on a head mounted display device for presenting a mixed reality or virtual reality experience. Once the displacement is detected, it may be corrected for to maintain the proper binocular disparity of virtual images displayed to the left and right display elements of the head mounted display device. In one example, the detection system uses an optical assembly including collimated LEDs and a camera which together are insensitive to linear displacement. Such a system provides a true measure of angular displacement of one or both display elements on the head mounted display device.