Technical Studies Reference


Price Volume Trend

The Price Volume Trend is similar in concept to On Balance Volume in that it is a cumulative total of volume that is adjusted depending on changes in closing prices. But whereas OBV adds all volume on days when prices close higher and subtracts all volume on days when prices close lower, the PVT adds only a portion of the daily volume. The amount of volume added to the PVT is a function of the amount by which prices rose or fell relative to the previous day's close.

The PVT is calculated by multiplying the day's volume by the percentage change of the underlying security and adding this value to a cumulative total. For example, if the security closed up 0.5% and volume was 10,000 shares, we would add 50 (i.e., 0.005 * 10,000 = 50) to the PVT. If the security had closed down 0.5%, we would have subtracted 50 from the PVT.

Formula:
PVT = (((Close - Yest_Close) / Yest_Close) * Vol) + Yest_PVT

Where:

Close = Today's closing price
Yest_Close = Yesterday's closing price
Vol = Today's volume
Yest_PVT = Yesterday's Price Volume Trend


*Last modified Friday, 21st April, 2017.