Confirming indicators
To refine your derivatives trading strategy, various confirming indicators to validate long and short orders can be used. This article details the settings for these indicators.
Trades will only be executed when the main strategy and the confirmation indicators agree. If TrailMe is used, it must complete its trailing process and meet other criteria simultaneously. All these conditions must align within the same cycle.
When integrating TrailMe with confirming indicators, setting the indicators too tightly could prevent trades from executing, as all conditions must be met at the same time.
Indicators are calculated with live data
Gunbot calculates indicators using real-time data. For instance, in a 14-period RSI calculation, Gunbot uses the closing values of the past 13 completed candles and the live data from the current open candle to determine the indicator value.
Exchanges do not provide indicator data; instead, they supply the raw data needed for calculations. While Gunbot utilizes what we consider the best library for indicators, it's crucial to remember that exchanges or TradingView might show slightly different indicator values due to their calculation methods.
Confirming Indicators settings
ADX (Average Directional Index)
| Label | Config Parameter | Default Value | Detailed Description |
|---|---|---|---|
| ADX enabled | ADX_ENABLED | false | Enables the ADX as a confirming indicator. This indicator assists in assessing the trend's strength, crucial for deciding on long or short orders. |
| ADX level | ADX_LEVEL | 25 | Establishes the minimum trend strength necessary for engaging in trades. The ADX level ranges from 1 to 99, with higher values indicating stronger trends. |
| DI period | DI_PERIOD | 14 | Specifies the period over which the ADX is calculated, allowing you to tune the sensitivity of trend detection. |
Stochastic Oscillator
| Label | Config Parameter | Default Value | Detailed Description |
|---|---|---|---|
| Stoch enabled | STOCH_ENABLED | false | Activates the Stochastic Oscillator as a confirming indicator, valuable for spotting overbought and oversold levels. |
| Stoch buy level | STOCH_BUY_LEVEL | 30 | Specifies the maximum Stochastic value to allow long orders, identifying potential oversold conditions suitable for going long. Set -1001 to disable. |
| Stoch sell level | STOCH_SELL_LEVEL | 70 | Defines the minimum Stochastic value for considering short orders, to capture overbought conditions likely preceding a price decline. Set -1001 to disable. |
| Stoch method | STOCH_METHOD | oscillator | Selects the operational mode for the Stochastic indicator. Oscillator mode requires the Stoch value to remain within the specified range, whereas Cross mode activates when the Stoch crosses a threshold. |
| Stoch K | STOCH_K | 14 | Defines the timeframe for calculating the %K line of the Stochastic Oscillator, influencing its responsiveness to market changes. |
| Slow stoch K | SLOW_STOCH_K | 3 | Determines the smoothing period for the %K line, impacting the indicator's sensitivity and smoothness. |
| Stoch D | STOCH_D | 3 | Sets the period for calculating the %D line, which is the moving average of the %K line, providing a reference for identifying crossovers and divergences. |
RSI (Relative Strength Index)
| Label | Config Parameter | Default Value | Detailed Description |
|---|---|---|---|
| RSI long enabled | RSI_BUY_ENABLED | false | Activates RSI as a confirming indicator for long orders. RSI evaluates the velocity and magnitude of price movements, helping identify potentially undervalued conditions for going long. |
| RSI buy level | RSI_BUY_LEVEL | 30 | Establishes the maximum RSI value to permit long orders. Lower RSI levels suggest oversold conditions and potential long opportunities. |
| RSI short enabled | RSI_SELL_ENABLED | false | Activates RSI as a confirming indicator for short orders. This setting aids in detecting when an asset is potentially overvalued, indicating a likelihood of price decline. |
| RSI sell level | RSI_SELL_LEVEL | 70 | Sets the minimum RSI value for initiating short orders. Higher RSI values suggest overbought conditions, signaling potential short opportunities. |
| RSI method | RSI_METHOD | oscillator | Defines the operational method for RSI: Oscillator mandates RSI to stay within a specified range, while Cross activates when RSI crosses a designated level. |
| RSI length | RSI_LENGTH | 14 | Sets the number of candles for calculating RSI, affecting its sensitivity to price changes. |
Stoch RSI (Stochastic Relative Strength Index)
| Label | Config Parameter | Default Value | Detailed Description |
|---|---|---|---|
| Stoch RSI enabled | STOCHRSI_ENABLED | false | Activates the Stoch RSI as a confirming indicator, beneficial for spotting more extreme overbought or oversold conditions compared to the traditional RSI. |
| Stoch RSI buy level | STOCHRSI_BUY_LEVEL | 0.2 | Specifies the maximum Stoch RSI value for allowing long orders, targeting oversold conditions that may offer good long opportunities. Set -1001 to disable. |
| Stoch RSI sell level | STOCHRSI_SELL_LEVEL | 0.8 | Defines the minimum Stoch RSI value for permitting short orders, aiming to identify overbought conditions likely to precede a price drop. Set -1001 to disable. |
| Stoch RSI method | STOCHRSI_METHOD | oscillator | Chooses the operational mode for Stoch RSI: Oscillator requires the indicator to be within a specified range for trades, while Cross triggers trades when the Stoch RSI crosses a predetermined level. |
| Stoch RSI length | STOCHRSI_LENGTH | 14 | Determines the number of candles used to calculate Stoch RSI, affecting how quickly the indicator responds to price changes. |
MFI (Money Flow Index)
| Label | Config Parameter | Default Value | Detailed Description |
|---|---|---|---|
| MFI enabled | MFI_ENABLED | false | Enables the Money Flow Index (MFI) as a confirming indicator, which uses both price and volume to measure buying and selling pressure, essential for derivatives trading. |
| MFI buy level | MFI_BUY_LEVEL | 30 | Sets the maximum MFI level at which long orders are allowed. Lower levels indicate potential oversold conditions, suggesting a buying opportunity. Set -1001 to disable. |
| MFI sell level | MFI_SELL_LEVEL | 70 | Defines the minimum MFI value at which short orders are considered. Higher values may indicate overbought conditions, suggesting a potential sell opportunity. Set -1001 to disable. |
| MFI length | MFI_LENGTH | 14 | Determines the number of candles used to calculate the MFI. A longer length provides a smoother but slower-to-react indicator. |
BTC PND Protection (Pump and Dump Protection for BTC)
| Label | Config Parameter | Default Value | Detailed Description |
|---|---|---|---|
| BTC pnd protection | BTC_PND_PROTECTION | false | Activates protection to prevent long orders during suspected pump and dump scenarios in the BTC/USD market, based on the Money Flow Index (MFI). |
| BTC pnd period | BTC_PND_PERIOD | 14 | Sets the MFI calculation period for the BTC pump and dump protection. This value adjusts the sensitivity of the MFI to recent price and volume changes. |
| BTC money flow | BTC_MONEY_FLOW | 25 | Sets the MFI threshold for BTC/USD. If the MFI drops below this value, it may indicate a pump and dump event, triggering protection mechanisms. |
EMA Spread
| Label | Config Parameter | Default Value | Detailed Description |
|---|---|---|---|
| EMA spread | EMASPREAD | false | Leverages the spread between the fast and medium Exponential Moving Averages (EMAs) as a confirming indicator for both long and short orders. |
| EMAx | EMAx | 0.5 | Sets the minimum percentage difference required between the fast and medium EMAs to validate trade signals, essential in identifying notable trend strengths. |
Other indicator settings
| Label | Config Parameter | Default Value | Detailed Description |
|---|---|---|---|
| Standard deviation | STDV | 2 | Adjusts the multiplier for calculating the width of the Bollinger Bands, which are employed to gauge market volatility and potential price targets. |
| SMA period | SMAPERIOD | 50 | Specifies the period over which the Simple Moving Average (SMA) is calculated, impacting tools like Bollinger Bands and trend analysis. |
| Candles length | CANDLES_LENGTH | 400 | Determines the amount of historical data requested from the exchange, crucial for computing various technical indicators. |
| EMA length | EMA_LENGTH | 100 | Sets the period for calculating the Exponential Moving Average (EMA), influencing its responsiveness and delay in reflecting market changes. |
Overview of effects on different order types
| Config Parameter | Affected Order Types | Not Affected Order Types |
|---|---|---|
| ADX Enabled | Strategy sell, Strategy buy | Close, Stop limit, DCA buy |
| ADX Level | Strategy sell, Strategy buy | Close, Stop limit, DCA buy |
| DI Period | Strategy sell, Strategy buy | Close, Stop limit, DCA buy |
| BTC PND Protection | Strategy sell, Strategy buy | Close, Stop limit, DCA buy |
| BTC Money Flow | Strategy sell, Strategy buy | Close, Stop limit, DCA buy |
| BTC PND Period | Strategy sell, Strategy buy | Close, Stop limit, DCA buy |
| EMA Spread | Strategy sell, Strategy buy | Close, Stop limit, DCA buy |
| EMAx | Strategy sell, Strategy buy | Close, Stop limit, DCA buy |
| MFI Enabled | Strategy sell, Strategy buy | Close, Stop limit, DCA buy |
| MFI Buy Level | Strategy buy | Strategy sell, Close, Stop limit, DCA buy |
| MFI Sell Level | Strategy sell | Strategy buy, Close, Stop limit, DCA buy |
| MFI Length | Strategy sell, Strategy buy | Close, Stop limit, DCA buy |
| RSI Buy Enabled | Strategy buy | Strategy sell, Close, Stop limit, DCA buy |
| RSI Sell Enabled | Strategy sell | Strategy buy, Close, Stop limit, DCA buy |
| RSI Method | Strategy sell, Strategy buy | Close, Stop limit, DCA buy |
| RSI Buy Level | Strategy buy | Strategy sell, Close, Stop limit, DCA buy |
| RSI Sell Level | Strategy sell | Strategy buy, Close, Stop limit, DCA buy |
| RSI Length | Strategy sell, Strategy buy | Close, Stop limit |
| Stoch Enabled | Strategy buy, Strategy sell | Close, Stop limit, DCA buy |
| Stoch Method | Strategy sell, Strategy buy | Close, Stop limit, DCA buy |
| Stoch Buy Level | Strategy buy | Strategy sell, Close, Stop limit, DCA buy |
| Stoch Sell Level | Strategy sell | Strategy buy, Close, Stop limit, DCA buy |
| Stoch K | Strategy sell, Strategy buy | Close, Stop limit, DCA buy |
| Slow Stoch K | Strategy sell, Strategy buy | Close, Stop limit, DCA buy |
| Stoch D | Strategy sell, Strategy buy | Close, Stop limit, DCA buy |
| Stoch RSI Enabled | Strategy buy, Strategy sell | Close, Stop limit, DCA buy |
| Stoch RSI Method | Strategy sell, Strategy buy | Close, Stop limit, DCA buy |
| Stoch RSI Buy Level | Strategy buy | Strategy sell, Close, Stop limit, DCA buy |
| Stoch RSI Sell Level | Strategy sell | Strategy buy, Close, Stop limit, DCA buy |
| Stoch RSI Length | Strategy sell, Strategy buy | Close, Stop limit, DCA buy |
| EMA Length | Strategy sell, Strategy buy | Close, Stop limit, DCA buy |
| Candles Length | Strategy sell, Strategy buy, DCA buy | Close, Stop limit |
| SMA Period | Strategy sell, Strategy buy, DCA buy | Close, Stop limit |
| Standard Deviation | Strategy sell, Strategy buy, DCA buy | Close, Stop limit |