OBV Smoothed applies a moving average (typically EMA 10-20 period) to the raw OBV line, reducing noise and making trends clearer. While raw OBV can be jumppy, smoothed OBV shows the underlying trend more clearly for trading signals.
Key Use: Identify cleaner OBV trend signals without raw line noise.
OBVS = EMA(OBV, 14)
First calculate OBV as standard
Then smooth with moving average of choice
Trend Clarity
Smoothed OBV shows clear uptrend vs downtrend more obviously.
Divergence Detection
Price higher but OBVS lower = clearer divergence signals.
Entry/Exit Filtering
Smooth crosses are cleaner signals than raw OBV bounces.
✓ Advantages
⚠ Limitations