What is on-balance volume indicator (OBV)?

On-Balance Volume Indicator (OBV) refers to a technical indicator of momentum that utilizes the positive or negative flow of the volume of trading to reflect the relative buying and selling pressure on a financial asset. The aim of monitoring the OBV is to predict the probable direction of near-term price changes.

What is on-balance volume?

On-balance volume provides a running total of an asset's trading volume and indicates whether this volume is flowing in or out of a given security or currency pair. The OBV is a cumulative total of volume (positive and negative). There are three rules implemented when calculating the OBV. They are: 1.

What is fidelity on balance volume (OBV)?

What Is OBV? - On Balance Volume - Fidelity On Balance Volume (OBV) measures buying and selling pressure as a cumulative indicator that adds volume on up days and subtracts volume on down days. When the security closes higher than the previous close, all of the day’s volume is considered up-volume.

How do you calculate on balance volume?

This is called a positive divergence. On Balance Volume is calculated by adding the day's volume to a cumulative total when the security's price closes up, and subtracting the day's volume when the security's price closes down.