Decision Making Inputs for MagicTradeBot Strategy Engine

Overview

MagicTradeBot offers a powerful, flexible, and highly customizable Decision Making Module that allows users to define complex rules for placing Long or Short trade orders for selected trading symbols. This module supports both basic and advanced inputs to optimize trading strategy based on real-time technical indicators, price movement, market conditions, and user preferences.

Input Types

There are two categories of decision-making inputs:

  • i. Basic Inputs
  • ii. Advanced Inputs

i. Basic Inputs

Basic inputs let you define Condition Groups that are collections of trade trigger conditions. The bot only needs one group to be validated for a trade decision to occur.

Condition Groups

Each condition group includes:

  1. Basic Settings
  2. List of Conditions
  3. Advanced Directional Settings
1. Basic Settings:
  • Direction: Long or Short. Determines trade direction if the group conditions are satisfied.
2. List of Conditions:
  • Percent % Change: e.g., 4% — The price change percentage to trigger the condition.
  • Change Direction: Up or Down — Detect upward or downward movement.
  • Match Condition:
    • Interval Start Position: Compare with the opening price of the interval.
    • Price Min Position: Compare with the lowest price in the interval.
    • Price Max Position: Compare with the highest price in the interval.
  • Interval: Choose from [1m, 3m, 5m, 15m, 30m, 1h, 2h, 4h, 6h, 12h, 1d, 2d, 3d, 7d]
    • Ensure kline data is available for the selected interval.

3. Advanced Directional Settings

Applied per condition group (for the defined direction only).

Advanced Inputs Include:
  • Show Advanced: [Toggle On/Off]
  • Min Price: Skip group if price is below this value. (0 = disabled)
  • Max Price: Skip group if price is above this value. (0 = disabled)
RSI-Based Conditions
  • Enable RSI Condition: [Toggle On/Off]
    • What is RSI?: RSI (Relative Strength Index) measures price momentum. A value above 70 typically signals overbought, and below 30 indicates oversold.
    • Usefulness: Useful for spotting potential reversals or confirming trends.
    • Example: RSI < 30 on 1h interval may signal a Long opportunity.
  • RSI Overbought Threshold: e.g., 70
  • RSI Oversold Threshold: e.g., 30
  • RSI Condition Direction:
    • OverSold (for Long)
    • OverBought (for Short)
    • Neutral
    • Any
RSI Divergence
  • Enable RSI Divergence Detection
    • What is it?: Divergence occurs when price moves in the opposite direction of RSI.
    • Usefulness: Often signals strong potential reversals.
    • Example: Price makes new low, RSI makes higher low → Bullish Divergence.
  • Divergence Type: Bullish, Bearish, or Both
  • Divergence RSI Period: e.g., 14
  • Lookback Bars: Number of previous candles to check for divergence pattern.

ii. Advanced Settings (Global Conditions)

These apply only if a directional group is already validated but act as additional filters.

Global Advanced Inputs

  1. Show Advanced Settings: [Toggle On/Off]
  2. Min Volume (24h): Prevents trades on low liquidity pairs.
    Example: Only trade pairs with 24h volume > 1,000,000 USDT.
    Impact: Reduces slippage and improves order execution.
  3. Min Price: Skips trading pairs priced below this threshold.
    Example: Avoid penny tokens under $0.01.
  4. Max Price: Skips trading pairs priced above this threshold.
    Example: Avoid high-priced assets like BTC when strategy is designed for altcoins.
  5. Gap Detection %: Detects minimum gap between candle closes and opens.
    Example: 1% gap detection catches sudden price jumps or dumps.
    Default: 0.5 - 2% recommended.
    Use Case: Identify volatility spikes.
  6. Enable Health-Based Scoring: Composite score based on multiple metrics.
  7. Min Health Score: Rejects symbols with scores below the threshold.
    Example: Only trade symbols with score > 60.
  8. Volume Weight (%): Influence of volume on health score.
    Example: Set to 40% if volume is crucial in strategy.
  9. Volatility Weight (%): Measures standard deviation or ATR.
  10. Band Position Weight (%): Measures price location within Bollinger bands or custom bands.
  11. Overbought Level (%): Example: 1.02 = 2% above upper band.
  12. Oversold Level (%): Example: 0.98 = 2% below lower band.
  13. Enable Gap Filter: Detect gaps between candle bodies.
    Example: Skip trade if gap > 3% in last 2 candles.
  14. Total Candles: Number of candles used to evaluate patterns like consolidation or breakouts.
  15. Enable Consolidation Check: Identifies range-bound price movement before breakouts.
    Impact: Increases breakout success probability.
  16. Consolidation Lookback: Example: 20-candle consolidation zone.
  17. Enable Breakout Check: Validates sudden movement beyond consolidation.
    Impact: Boosts entry timing accuracy.
  18. Breakout Sensitivity: Example: 0.5 means breakout is detected if close > high * 1.005

This comprehensive module gives traders full flexibility to build robust decision trees, from simple momentum triggers to multi-layered composite strategies involving health scoring, volatility, and advanced technical indicators.

MagicTradeBot’s Decision Engine is designed to balance precision and adaptability, allowing both novice and professional traders to craft rule sets that align with any market condition.

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