What is the meaning of on balance volume in the context of cryptocurrency trading?

3 answers

• Bruna NascimentoSep 12, 2024 · a year ago
  On balance volume (OBV) is a technical analysis indicator that measures buying and selling pressure in the market. It takes into account the volume of trades and whether the price closed higher or lower than the previous period. When the OBV is rising, it suggests that buying pressure is increasing, indicating a bullish trend. Conversely, when the OBV is falling, it suggests that selling pressure is increasing, indicating a bearish trend. Traders use OBV to confirm price trends and identify potential reversals. It can be a useful tool in cryptocurrency trading to gauge market sentiment and make informed trading decisions.
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• surjith surjiSep 08, 2020 · 5 years ago
  OBV is like a crystal ball for traders. It helps you see the future! Just kidding, but it is a useful indicator in cryptocurrency trading. OBV takes into account the volume of trades and whether the price closed higher or lower than the previous period. By analyzing these factors, it gives you an idea of the buying and selling pressure in the market. This can help you confirm trends and spot potential reversals. So, if you're into cryptocurrency trading, OBV is definitely worth checking out!
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• trisa4372 trisaOct 28, 2023 · 2 years ago
  On balance volume (OBV) is a popular indicator used by traders to analyze the flow of volume in the market. It was developed by Joseph Granville and is based on the theory that volume precedes price movement. OBV calculates the cumulative sum of volume on up days and subtracts the cumulative sum of volume on down days. The resulting line can be used to confirm trends, identify divergences, and predict potential reversals. In the context of cryptocurrency trading, OBV can be a valuable tool to assess market sentiment and make informed trading decisions. However, it should be used in conjunction with other indicators and analysis techniques for a comprehensive trading strategy.
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