Cumulative volume (also known as on-balance volume, credited to analyst Joseph Granville) is simply a running total of daily volume. If the market goes up, then that day’s volume is added to the total. If the market goes down, then the day’s volume is subtracted from the total. Overlay the result on a simple price chart, something most commercial software packages can do, and supply and demand can be readily seen.
When bulls are dominating a market, up-days are often accompanied by higher volume than are down-days. The reason is that demand is higher than supply, forcing prices to rise and allowing trades to get done. Whether buyers or sellers were in control on a particular day (or other time frame) cannot be easily ...