Essentially when data is close together, I want to avoid showing the stack of tooltips and only display the nearest one. I have tried all the techniques that I have found that the link above also references to but none of them seem to work in Bokeh 3 anymore.
I currently have my own CustomHTML for the tool tip and is very similar to the example expressed in the stack overflow question.
Am I missing a new setting that might make this easier? Or is an approach like this still required?
There is some in-flight work to make improvements in this area, but they are still under discussion / not merged. e.g. this PR which might land for 3.8 (but may also get delayed)
The solution you refer to on SO seems OK to me. I have sometimes used a setup with a regular CustomJS callback and a Label or Div element in a corner of a plot. The HoverTool callback gets the hovered indices as an array with cb_data.index.indices (scatter glyph). I can choose which index I want (if for some reason I want a specific). Then I update the text with the info I want to display.