On-Balance Volume (OBV)

Measures: cumulative volume signed by price direction — a crude but effective proxy for whether money is flowing in (accumulation) or out (distribution).

Formula:

OBV_t = OBV_(t−1) + V_t   if C_t > C_(t−1)
        OBV_(t−1) − V_t   if C_t < C_(t−1)
        OBV_(t−1)         if equal

How Thresher uses it (Volume family): the OBV level is meaningless (it depends on where the series starts), so the engine reads only its 20-bar delta, cross-referenced against the 20-bar price delta:

OBV Δ20	Price Δ20	Reading	Points
up	up	accumulation confirms	+0.50
down	down	distribution confirms	−0.50
up	down/flat	bullish divergence (early, weaker)	+0.20
down	up/flat	bearish divergence	−0.20

Limitations: OBV treats a +0.01% bar and a +5% bar identically (full volume credited either way), is distorted by splits and gap opens, and inherits whatever quality problems the volume feed has. It carries the lowest family weight in the engine partly for these reasons.

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