Here is how On Balance Volume indicator helps traders track smart money

In OBV indicator, a positive close candle volume is added cumulatively and negative close volume is subtracted to determine the trend

Volume plays a significant role in determining the movement of an asset price. Stocks or indices having marginal support of volume may fail to deliver consistent growth. If an asset is showing strong upside, but is unaccompanied by a rise in volumes (market participation), then the rally is likely to subside in the near-term.

The major indicator used to ascertain the market direction based on volume is 'On Balance Volume' (OBV). This indicator helps identify the major moves supported by volumes. Herein, a positive close candle volume is added cumulatively and negative close volume is subtracted to determine