The explosive_threshold_pct parameter is the core sensitivity control of the Volatility Gate. It determines how much adverse smoothed movement must occur before a DCA order is held for observation. Proper tuning is critical to balance safety and responsiveness.

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🔹 1️⃣ Purpose of explosive_threshold_pct

• Higher Value:

  • Only extremely fast or large moves trigger the gate.
  • Most DCA orders fire immediately during normal price dips.
  • Best for stable assets like BTC or ETH.

• Lower Value:

  • Even moderate rapid moves trigger a hold.
  • Reduces risk in high-volatility altcoins, preventing DCA stacking in sharp crashes or pumps.
  • May delay more orders than necessary in stable markets.

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🔹 2️⃣ How to Tune

1. Assess the Asset’s Volatility:

   • BTC / Large Caps:

     • Price rarely jumps 5–7% in minutes.
     • Use 4–5% to catch only rare explosive events.

   • Low-Cap / Meme Coins:

     • Price can swing 5–15% in minutes.
     • Use 1.5–3% to capture frequent momentum spikes.

2. Decide Your Risk Appetite:

   • Conservative: lower threshold → more orders held → safer, slower DCA.
   • Aggressive: higher threshold → fewer holds → faster DCA execution, higher exposure.

3. Monitor Logs During Demo:

   • Check for messages:

     • 🔭 Volatility gate: HELD → how often orders are delayed
     • ✅ Volatility gate: CLEAR → orders firing immediately
   • Adjust to achieve a balance between avoiding explosive exposure and keeping DCA flow smooth.

4. Combine With Observation Settings:

   • Lower explosive threshold works best with:

     • required_neutral_streak = 2–3
     • max_observation_minutes = 120–180
   • This ensures DCA orders are only released when momentum truly stabilizes.

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🔹 3️⃣ Practical Examples

Asset Type	Market Behavior	Suggested Explosive Threshold
BTC	Generally stable, moderate dips	4.0 – 5.0%
ETH	Medium volatility	3.5 – 4.5%
Low-Cap Altcoins	Rapid spikes, crashes common	1.5 – 3.0%

• Example: A $5,000 position in a low-cap coin drops 6% in 10 minutes.

  • Threshold = 3% → DCA held, waits for momentum cooldown → better average entry.
  • Threshold = 5% → DCA fires immediately → exposes capital to ongoing crash.

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🔹 4️⃣ Summary

• explosive_threshold_pct controls how sensitive Volatility Gate is to rapid market movements.
• Lower value: safer, more DCA holds, ideal for volatile assets.
• Higher value: fewer holds, faster DCA, better for stable coins.
• Tune based on asset volatility, personal risk tolerance, and observation settings.
• Always validate in demo mode before live trading.

Think of it as the “volatility sensitivity knob”: turn it down for safety, up for speed — the key is finding the right balance for each asset type.

📎 Related Topics

• Should I test DCA strategies in demo mode first?
• What are recommended DCA settings for beginners?
• How can I tell if my DCA configuration is too aggressive?
• What are common DCA mistakes to avoid?
• What are recommended Volatility Gate settings for BTC?