Trends/Volume and money flow

On-balance volume

A running total that adds the day's volume on up days and subtracts it on down days.

Volume and money flowBest on 6M, 1YAlso called OBV

Illustration of the on-balance volume shape. It is a sketch, not real price data.

What it shows

Joseph Granville's OBV starts at zero. If today's close is higher than yesterday's, add today's volume. If lower, subtract it. If unchanged, add nothing.

The line itself is not meaningful in size. What matters is its direction compared with price.

How we find it

The same code that draws it on your chart follows these steps, with the same result every time.

If close > previous close: OBV = OBV + volume.
If close < previous close: OBV = OBV − volume.
If equal: OBV unchanged.
Plot under the price.

Starting values: Start 0. These are proposed and will be tuned on real price data before launch.

How to read it

The panel shows the running total.
Rising: up days have carried more volume.
Falling: down days have carried more.

Status labels you may see

Label	What it means
Rising	OBV is higher than 20 bars ago.
Falling	OBV is lower than 20 bars ago.
Flat	Change under 2% of range.

What cancels it

Nothing cancels it.

What traders check next

Whether OBV and price agree on highs.
The slope of OBV.
Volume spikes in the total.

Limits

All of the day's volume is assigned to one side.
The start date changes the absolute value.
One huge day can dominate.

Try it in forecastviz

Open any ticker and choose Volume and money flow → On-balance volume in the left menu.
Switch between 6M, 1Y to see how the picture changes.
Compare with Accumulation/distribution line and Chaikin money flow on the same chart.

Open on a ticker

Questions

Why is the number so big?

It is a cumulative total, and only the shape matters.

Does rising OBV mean buying?

It means up days had more volume. Every trade has both sides.