OBV Plus
This volume-based MotiveWave study gives you a way of measuring buying and selling pressure and finding divergences in volume and price. Since volume often precedes price, it can be a leading indicator.
For comparison with the classic On Balance Volume (OBV) study, I have added both indicators to some of the chart examples below.
How to use OBV Plus
Spot Divergences
Divergences are a powerful way to identify potential trend reversals before they happen. OBV Plus makes it especially easy to spot divergences between price action and volume flows, allowing you to anticipate when price movement is losing momentum or about to change direction.
For clarity, I have added lines to highlight the divergences on some of the screenshots. After training your eyes to spot divergences, you will be able to see them in seconds without extra help from lines.
For more information on how to spot divergences you can check out this general guide or this in-depth OBV article.
Click to zoom
Confirm ongoing trends
A rise in the OBV Plus alongside a surge in price action indicates increasing buying pressure, further supporting the continuation of a bullish trend, and the opposite for a bearish trend.
In this example, notice how in the middle of the impulsive move up, OBV Plus pointed up and showed strength. Price continued up after that. It was only after a divergence formed that the momentum cooled off and price started ranging.
Breakout trades
OBV Plus showing strength during a breakout attempt signals a likely genuine breakout. Conversely, divergences during breakout attempts warn breakout traders to be cautious and offer reversal/range traders a potential fade opportunity. Consider checking lower timeframes for additional divergence confirmation.
In this 30m Crude Oil chart, bullish divergence during the low breakout attempt signaled weak downside momentum, suggesting accumulation. Strong OBV+ momentum without divergence at range highs provided early breakout confirmation. During the subsequent backtest, bullish divergences confirmed the classic 'breakout → backtest → continuation' pattern.
2022 major bottom on ES
In this trend reversal example, you can see OBV+, especially together with Volume Plus, showed a very clear bottom formation on the 1-day chart. This was a powerful entry signal for long-term investors and swing traders.
Even if you waited for more confirmation a couple of days later (until the OBV+ started pointing up again), it would still give you a fantastic entry for this generational bottom. The default OBV showed nothing.
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