I often think is a great indicator as trend direction and cannot lie.
However, I bumped into a few problems.
It is slow, doesn't show and often time it is prone to chop.
That's why I added ATR to the equation.
Original OBV calculation
src > 0? : +volume : src < 0? -volume
Modified OBV with ATR
src > 0 ? +volume * ( / atr) : src < 0? -volume * ( / atr)
I have used 2 for this modified OBV.
By adding ATR to the equation we can smooth out many erratic price movement. (Stop hunting)
Also, when price move slowly but steady, often prepping for a big move, this indicator will move faster.
In short, this indicator prevents you from being stop hunted and also provide great entry for a trending market.
Works well on BTCUSD XBTUSD , as well as other major liquid Pair.
Feel free to follow me on Twitter @Lancelot_Auger for more free Alpha.
Please acknowledge my effort by like and follow.
Save Hong Kong, the revolution of our times.
In true TradingView spirit, the author of this script has published it open-source, so traders can understand and verify it. Cheers to the author! You may use it for free, but reuse of this code in a publication is governed by House Rules. You can favorite it to use it on a chart.