Xray, Subhadeep bro's,
The OBV indicator advocated by Varunji is robust as volume plays an important role in holding/entering the trade; however OBV is not the primary indicator it’s his years of experience which is allowing him to trade his system profitably. He is able to identify & combine OBV with multiple systems based on current market situation and hence it’s confusing to people following his methods. However one should be humble enough to accept positive criticism which will definitely help in improving & evolving the system.
Long time back I was using OBV and used to consider it the Holy Grail.., however later I found that the main challenge with OBV is its volatility as it takes into consideration only the total volume of the candle and not the price action associated with it. When there are bulk trades or heavy volumes it used to distort the indicator completely. Later I read a good article by David G. Hawkins on modified Volume-Price Trend (VPT) Indicator (http://edmond.mires.co/GES816/20-Modified Volume-Price Trend Indicator.pdf) which had drastic improvements over OBV. It reduces the volatility as also gives clearer signals when compared to OBV.
I am not imposing, however if one apply VPT instead of OBV in the systems explained by Varunji or any of your current systems you can see immediate improvements. Please don’t take my word for it do your own homework.
Subhadeep bro, Applying VWMA (Volume weighted moving average) on your MA crossover system gives excellent results. Please check the details on VWMA given in the following URL: https://www.tradingsetupsreview.com/volume-weighted-moving-average-vwma/
The OBV indicator advocated by Varunji is robust as volume plays an important role in holding/entering the trade; however OBV is not the primary indicator it’s his years of experience which is allowing him to trade his system profitably. He is able to identify & combine OBV with multiple systems based on current market situation and hence it’s confusing to people following his methods. However one should be humble enough to accept positive criticism which will definitely help in improving & evolving the system.
Long time back I was using OBV and used to consider it the Holy Grail.., however later I found that the main challenge with OBV is its volatility as it takes into consideration only the total volume of the candle and not the price action associated with it. When there are bulk trades or heavy volumes it used to distort the indicator completely. Later I read a good article by David G. Hawkins on modified Volume-Price Trend (VPT) Indicator (http://edmond.mires.co/GES816/20-Modified Volume-Price Trend Indicator.pdf) which had drastic improvements over OBV. It reduces the volatility as also gives clearer signals when compared to OBV.
I am not imposing, however if one apply VPT instead of OBV in the systems explained by Varunji or any of your current systems you can see immediate improvements. Please don’t take my word for it do your own homework.
Subhadeep bro, Applying VWMA (Volume weighted moving average) on your MA crossover system gives excellent results. Please check the details on VWMA given in the following URL: https://www.tradingsetupsreview.com/volume-weighted-moving-average-vwma/
Thanks for the suggestion, i will watch VPT !!!
Last edited: