Technical Indicator: On-Balance Volume (OBV)

On-Balance Volume (OBV)

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Question

What is the name of this technical indicator?

(Number of advancing issues + 1/2 volume of issues unchanged) / total number of issues traded

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Explanations

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A. B. C. D. E.

C

The technical indicator profiled in this example is the diffusion index, which is a measure of market breadth. While "Advance/Decline Line" is an esthetically appealing choice, it is nonetheless incorrect. The Advance/Decline Line is found by subtracting the volume of declining issues by the volume of advancing issues, with no regard to the volume of issues unchanged.