Cell-free DNA (cfDNA) are DNA fragments originating from dying cells that are detectable in bodily fluids, such as the plasma. Accelerated cell death, for example caused by disease, induces an elevated concentration of cfDNA. As a result, determining the cell type origins of cfDNA molecules can provide information about an individual's health. In this work, we aim to increase the sensitivity of methylation-based cell type deconvolution by adapting an existing method, CelFiE, which uses the methylation beta values of individual CpG sites to estimate cell type proportions. Our new method, CelFEER, instead differentiates cell types by the average methylation values within individual reads. We additionally improved the originally reported performance of CelFiE by using a new approach for finding marker regions that are differentially methylated between cell types. We show that CelFEER estimates cell type proportions with a higher correlation (r = 0.94 ± 0.04) than CelFiE (r = 0.86 ± 0.09) on simulated mixtures of cell types. Moreover, we show that the cell type proportion estimated by CelFEER can differentiate between ALS patients and healthy controls, between pregnant women in their first and third trimester, and between pregnant women with and without gestational diabetes.