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On Balance Volume-Candlesticks vs Heikin Ashi

JJJJ
JJJJ ✭
in SharpCharts
I am looking at shorter time frame....2, 5, 15, 30 min time frame and I am comparing OBV of 2 charts of the same stock. One chart uses candlesticks and the other uses Heikin Ashi. I also overlayed a 100 SMA moving average of the OBV in both cases. The OBV graphs look quite a bit different..(even the 100 SMA). Which setup actually gives me the best real values of On Balance Volume?

Comments

  • markd
    markd mod
    edited October 2023
    I'll just guess that the candle stick chart is more reliable, since OBV was developed with ordinary price bars in mind. Joe Granville didn't know anything about H-A.

    I would suggest trying Force in place of OBV, with custom parameters. Force compiles only a share of volume commensurate with extent of the price change, instead of all the volume based on just a change in sign. I think it catches accumulation and distribution sooner and more accurately. Force is promoted as a short term indicator to catch short price swings, but it seems to work just as well (or better) in forecasting longer term trend direction changes. You could try Force(63) or Force(251) with like MAs. Crossing the MAs and staying there forecasts (or sometimes confirms) a trend direction change in the direction of the crossover.

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