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8.2 On Balance Volume – OBV

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Following from part one of volume we move on to On Balance Volume (OBV).
OBV was first developed by Joseph Granville. He believed that volume was the driving force behind markets and developed OBV to forecast when major moves would occur based on volume changes.
OBV is an indicator of momentum, measuring changes in volume to determine price direction.
OBV provides more information than the volume histograms typically found at the bottom of the charts.
This particular indicator is a leading one, while some traders will trade on OBV alone, it isn't recommended.
Always support your ideas with additional TA for confluence.