On Balance Volume (OBV)

A technical trading momentum indicator that makes use of volume flow to forecast changes in price. Granville, the OBV creator, invented this indicator to help predict when significant changes in the markets would occur based on changes in volume, believing that volume was the driving force behind market performance. In his book "New Key to Stock Market Profits", he compared OBV's predictions to "a spring being wound tightly." He thought that when volume spikes significantly without a major change in the stock's price, the price will eventually follow, with either a rally to the upside (if the bulls were pressing), or rolling over (if the bears stepped in).