TASC 2020-04 | On-Balance Volume Modified - OBVM (Apirine)

Modified on 2020/02/29 05:24 by Eugene — Categorized as: TASC Traders Tips

Traders' Tip text

Long-time readers of our Tips have noticed a tradition to show how trading ideas can get done without coding. Being as uber simple as an EMA applied to OBV, it makes this month's OBVM indicator a natural target for another codeless exercise. Wealth-Lab's "Strategy From Rules" allows to produce a complete trading Strategy from the building blocks known as Rules.

Realizing that original OBV's character is pretty wiggly, creators of Wealth-Lab enabled its non-programming users with a set of "Smoothed OBV" rules... more than a decade ago. To make possible the OBVM signal line crossovers as per the article, we added respective conditions to our Community.Rules project - a library aimed at expanding the capabilities of non-programmers.

After installing or updating the library, let's start by choosing "New Strategy from Rules". Then drag and drop an entry and an exit rules (e.g. "Buy(Sell) at Market)". Now it's time to add OBVM conditions. Pair the "OBVM crosses above (below") Signal Line" condition (from the “On-Balance Volume” group) with the entry (exit) condition by dragging and dropping onto it. And as suggested by Vitali Apirine, you might want to combine OBVM with other conditions because OBVM isn't a standalone indicator.

The default lookback periods are 7 for OBVM and 10 for its signal line. As a final step, click the icon next to the lookback period to expose it as a "slider" at the bottom left. Now as you drag it to change the indicator's period, the chart will reflect it and so will your trading system's backtest performance update dynamically.


Figure 1. A “Strategy from Rules” window in Wealth-Lab 6 which illustrates the process of dragging and dropping OBVM conditions to arrive at a plain vanilla trading system. Here, we choose the rules for crossover of the OBVM with its signal line.

WealthScript Code (C#)


Gene Geren (Eugene)
Wealth-Lab team