Shaking camera

Here is the basic idea:

• In a top down view I want the camera to follow the player.

• The mouse controls the rotation of the player (AngryBots movement style)

• WASD to move (again, like AngryBots)

I want the camera to slightly move towards the direction the player is pointing at. I came up with an offset camera routine to smooth the transition but my camera won't stop shaking.

Here is the code for the camera:

 public class PlayerCamera : MonoBehaviour {
 
 public Transform testOffsetTarget;
 
 public static PlayerCamera instance;
 public Transform targetLookAt;
 
 private Vector3 cameraOffSetVector = Vector3.zero;
 private Vector3 desiredOffset = Vector3.zero;
 private Vector3 desiredPosition = Vector3.zero;
 private Vector3 position = Vector3.zero;
 
 private float posX;
 private float posY;
 private float posZ;
 
 private float velX;
 private float velY;
 private float velZ;
 
 private float smoothVel = 0.05F;
 private float offsetVel = 0.05F;
     
 
 void LateUpdate () {        
     if(targetLookAt == null)
         return;
     HandlePlayerInput();        
     CalculateDesiredPosition();        
     UpdatePosition();
     CalculateDesiredOffset();
     OffsetCamera();
 }
 
 void UpdatePosition()
 {            
     posX = Mathf.SmoothDamp(transform.position.x, desiredPosition.x, ref velX, smoothVel);
     posY = Mathf.SmoothDamp(transform.position.y, desiredPosition.y, ref velY, smoothVel);
     posZ = Mathf.SmoothDamp(transform.position.z, desiredPosition.z, ref velZ, smoothVel);
     
     position = new Vector3(posX, posY, posZ);
     
     transform.position = position;        
 }
 
 void HandlePlayerInput()
 {
     var radius = 5.0F;
     
     Vector3 diff = PlayerController.instance.targetPoint - transform.position;
     
     float distance = diff.magnitude;
     
     if(distance > radius)
     {            
         cameraOffSetVector = transform.position + (diff / distance) * radius;            
     }
 }
 
 void CalculateDesiredPosition()
 {        
     desiredPosition = CalculatePosition(targetLookAt.position.x, targetLookAt.position.y, targetLookAt.position.z);                
 }
 
 void OffsetCamera()
 {
     posX = Mathf.SmoothDamp(position.x, desiredOffset.x, ref velX, offsetVel);
     posY = Mathf.SmoothDamp(position.y, desiredOffset.y, ref velY, offsetVel);
     posZ = Mathf.SmoothDamp(position.z, desiredOffset.z, ref velZ, offsetVel);
     
     position = new Vector3(posX, posY, posZ);
     
     transform.position = position;
     Debug.Log(transform.position);
 }
 
 void CalculateDesiredOffset()
 {        
     desiredOffset = CalculatePosition(cameraOffSetVector.x, targetLookAt.position.y, cameraOffSetVector.z);                
 }
 
 Vector3 CalculatePosition(float x, float y, float z)
 {
     Vector3 direction = new Vector3(x, transform.position.y, z);
     return direction;
 }

}

I appreciate any feedback