Cluster Arrow is an Archery Demon Hunter skill unlocked at Level 27. The Demon Hunter fires an arrow that hits the ground (in its basic version), and grenades erupt from the consequent blast, which in turn explode to damage enemies.
The following is a very quick summary. See the Cluster Arrow rune effects page for a more thorough description of rune effects, or any of the individual rune pages for numbers, screenshots, blue quotes, and much more.
Cluster Arrow appears to have a direct damage component before generating the grenades that explode and damage the enemies within its radius with fire damage.
Three sharp red lines appear behind the demon hunter and travel forward, the blast hitting the ground with a fairly large explosion, leaving a decal on the ground, where the grenades pop out of. The grenades, much like the Grenade skill itself, will bounce around for a short while before detonating.
Skill tiers were removed shortly before the beta started in September 2011, and Cluster Arrow became a level 23 skill, but was soon changed to 27. The skill system was once again overhauled for the Beta Patch 13, and Cluster Arrow was classified as a Devices skill and moved up to level 28. For Beta patch 14, it was re-classified as an Archery skill and moved back to level 27.