Price/OBV divergence — Indicator by traileriana

Shows agreement or disagreement between the direction of the the price and the on-balance volume. When they disagree, the price is supposed to follow the OBV (or so they say.)

Open-source script

In true TradingView spirit, the author of this script has published it open-source, so traders can understand and verify it. Cheers to the author! You may use it for free, but reuse of this code in a publication is governed by House Rules. You can favorite it to use it on a chart.

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Want to use this script on a chart?

//@version=2
study("Price/OBV divergence", "Price/OBV")
period = input(30, "Period")

// tanh(v) => (exp(v) - exp(-v))/(exp(v) + exp(-v))
// dema(x, p) => 2*ema(x, p) - ema(ema(x, p), p)

obv = cum(change(close) > 0 ? volume : change(close) < 0 ? -volume : 0*volume)

c = sign(change(ema(close, period)))
o = sign(change(ema(obv  , period)))

cc = c == o ? c : c/3*2
oo = o == c ? o : o/3*2

plot(cc, style=columns, transp = 50, color = red )
plot(oo, style=columns, transp = 50, color = blue)