OBV
Volumedraws in its own pane
A running total that adds volume on up closes and subtracts it on down ones. The level is meaningless; divergence against price is the message.
On this chart: Cumulative, close-over-close.
What it measures
On-Balance Volume adds each bar's entire volume when the close rose and subtracts it when the close fell. The absolute number depends on where the series starts and means nothing — the shape is the indicator. Joe Granville's premise: volume leads price, because accumulation shows up in turnover before it shows up in the quote.
How to read it
Read OBV's trend against price's trend. Agreement confirms; divergence is the message. Price grinding lower while OBV holds flat says the decline is running on thin volume — sellers thinning out rather than pressing. Price flat while OBV climbs is quiet accumulation.
Using it on the wheel
During basing periods after a decline — prime hunting ground for the wheel — OBV distinguishes a base that is being accumulated from one still being distributed. A flat price with rising OBV describes demand absorbing supply, context that favors the level a put strike sits behind.
Like everything in this guide, these are descriptions of conditions and reference levels — context for your own decisions, not instructions to trade.