Formula
OBV(first) = 0
OBV = OBV[t-1] + V if C > C[t-1]
OBV = OBV[t-1] - V if C < C[t-1]; unchanged if C = C[t-1]How TraderAI calculates it
TraderAI starts OBV from 0 at the beginning of the loaded history and then adds or subtracts each candle's volume depending on whether its close is above or below the previous close; an unchanged close leaves OBV unchanged. OBV needs volume confirmed by the exchange: where the data source cannot confirm it, the indicator stays unavailable instead of using estimated volume.
Live example
How traders read it
The direction of OBV matters more than its level: a rising line means more volume on up closes, a falling line more volume on down closes.
When price makes a new high but OBV does not, the move is happening on weaker volume, which traders treat as a warning.
OBV breaking out before price is sometimes read as accumulation or distribution building.
Limitations
- The absolute value depends on where the history starts, so only changes and slopes are meaningful.
- One very large candle can dominate the total, and OBV treats a tiny price change the same as a large one.
Settings and defaults
This indicator has no adjustable settings.
What it plots
Drawn in its own pane below the price chart, with its own scale.
| Line | Unit | Drawn as | First value |
|---|---|---|---|
| Value | Volume based | Line | after 2 candles |
Calculation notes
- Needs volume confirmed by the exchange. On data sources that cannot confirm it, TraderAI keeps this indicator unavailable instead of estimating volume.
- Running total of volume signed by the close direction, restarting at 0 after every gap. Needs verified volume.
Questions
What is On-Balance Volume?
On-Balance Volume (OBV) is a running total of volume that adds a candle's volume when the close rises and subtracts it when the close falls. It shows whether volume has been flowing more on up candles or on down candles.
How does TraderAI calculate On-Balance Volume?
TraderAI starts OBV from 0 at the beginning of the loaded history and then adds or subtracts each candle's volume depending on whether its close is above or below the previous close; an unchanged close leaves OBV unchanged. OBV needs volume confirmed by the exchange: where the data source cannot confirm it, the indicator stays unavailable instead of using estimated volume.
What are the default settings of On-Balance Volume?
On-Balance Volume has no adjustable settings: it is calculated the same way on every chart.
Can I use On-Balance Volume for free on TraderAI?
Yes. Every indicator in the library can be added to the free live chart. The free plan keeps up to 2 indicators active at the same time; Pro lets you combine more on one chart.
Educational content. Indicators describe past prices; they do not predict future prices and are not investment advice.