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Todoubled23
Jun 9, 2021 3:57 AM

On Balance Volume Use Cases Education

TRACON Pharmaceuticals, Inc.NASDAQ

Description

TCON
BNGO
ONTX





TCON daily chart. January 16 2020 traded half it's float.

March 2020 - Covid
3/16 to 8/27 Consolidation and huge block orders.
Notice how regardless of the price, OBV is climbing higher and higher steps up, 1 step back 2 steps forward. Simple addition then subtraction rules apply and add and subtract green/red days volume for weighting.
Then 8/17 TCON traded nearly twice it's float and laid dormant for close to a week. Despite many daily candles being red (faded) OBV jumped up from 12M to 30M overnight...
TCON then ran from 1.50s to $12.30 over the next few months.

After look.



BNGO same story.


After.


ONTX insane gap fill off a phase 3 failure.


After.



Overall, if obv doesn't look like this I rarely enter trades long term unless its an intraday position or possible swing. I'll have more examples coming. Good luck and I hope this was useful.

Comment

Use OBV to avoid being shaken out whether scalping, swing trading, or any other trade you put on. It helps to keep conviction in a world where having an actual passive stop loss will only make you puke into support and likely watch it go the other way after you've been stopped.

Comment

If there are big fish accumulating, this will show you. Look for sharp drops in OBV and then retest of price to confirm or deny your entry. Good luck, its all I use along with just having a general understanding of normal market structure on a micro and macro scale. Always use multiple time frames and for the love of God stop looking at 1 minute charts unless you are *elite*.
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