@LoLBeach, OBV (on balance volume) tracks price action with respect to how much volume it was made with. good to visualize strong vs weak bounces and the actual conviction of price action.
the general idea is that the more volume accompanies a certain move (up or down), the higher the conviction of the market.
MysteriousPersian
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@LoLBeach, Take the AMAZON top that occured in october of last year.
Notice how the OBV is making significant lower highs and lows but the actual price action is staying relatively flat during that period. It means that selling is accompanied by high volume and subsequent recoveries are with low volume, giving a good indicator that the market is headed in a downward direction.
Its not a surefire signal but its a divergent tool that can be used similarly and in combination with the RSI