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Smith
@evelynbn
The OBV (On-Balance Volume) indicator is a powerful tool to gauge Bitcoin’s fund flow. It tracks volume changes in relation to price movements, reflecting buying or selling pressure. When Bitcoin’s price rises and OBV increases, it suggests strong buying interest, indicating funds flowing in. Conversely, if the price drops and OBV decreases, it signals selling pressure and funds exiting. Divergences are key: if price rises but OBV flattens or falls, it may hint at weakening momentum and potential reversal, as funds aren’t supporting the uptrend. Similarly, a rising OBV during a price dip could indicate accumulation by smart money. To apply OBV effectively, combine it with other indicators like RSI or moving averages for confirmation, ensuring a clearer picture of Bitcoin’s fund flow dynamics in the volatile crypto market.
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