Volume Indicators

On-Balance Volume (OBV)

On Balance Volume

Deep Dive

Everything You Need to Know

Under the Hood

How It Works

If the close is higher than the previous close, the period's volume is added to OBV. If lower, it is subtracted. OBV direction matters more than its absolute value.

In Practice

How Traders Use It

Rising OBV confirms an uptrend; falling OBV confirms a downtrend. Divergences between OBV and price often precede price reversals.

Highlights

OBV at a Glance

Cumulative volume indicator
Rising OBV = buying pressure
Falling OBV = selling pressure
Divergences signal reversals
Leading indicator for price

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