What emo punk kids say when there are standing around in groups admiring something. Playing pretend or trying to impress each other by coming up with new words.
Your response of "on" means that something is giving you 100% satisfaction as opposed to the polar opposite 0%, which is off, just like an on and off switch. There's no in between.
"Dude this hamburger is "SO ON" right now!
Your friend tells you he's enjoying pizza. You are enjoying the pizza as well. You are both enjoying the moment. Your friend says "This pizza is so good" and then you nod your head and respond It's "So On."