Short-term Price & Volume Spikes and long-term highs/lows

Ekliptor

Administrator
Staff member
Requirements:

Getting started:

Go to the "Configuration" page of your WolfBot instance and select the configuration named "VolumeSpikeStats".
This is an example configuration watching Litecoin on Bitfinex and using margin trading to buy/sell at price and volume spikes.

Switch to the "Trading" tab of the "Configuration" page and adjust (remember to read all parameter explanations on this page carefully):
  • your exchange(s) (used for Backtesting as well as live trading)
  • the coin pairs you want to jump on price/volume spikes on
  • you want to set the candleSize parameter of VolumeSpikeDetector and PriceSpikeDetector to a relatively low value (1-5min) to react quickly on spikes
    • for VolumeSpikeDetector: set the spikeFactor to a value when the bot shall open a position. For example 3x means it will trade when the current candle has 3x the average volume
    • for PriceSpikeDetector: set spikePercent to a value how much the price of the current candle shall increase/decrease for WoflBot to open a buy/sell trade
    • for both: you can set the tradeDirection to both, up or down if you only want to do buy/sell trades. Additionally "notify" means you will only get a push notification on your smartphone if a spike happens

Additional (optional) strategies analyzing the market:
  • VolumeSpikeDetectorLong: this strategy can be configured to look at volumes spikes of longer candles (4-12 hours). If there is a candle with factor x above the average this means trading activity and therefore interest in a coin is rising. This often leads to sharp price movements. This strategy only sends push notifications.
  • IntervalExtremes: This strategy displays you some information about high/low values of your coin for certain time periods (daily, 3 days, weekly,...) plus Fibonacci retracements, the number of bullish and bearish candlestick patterns and more..
    You can use this data to make your trading decisions, fine tune your strategies or access it directly from another strategy to refine your algo trading.
    IntervalExt.png
  • OrderPartitioner: This strategy partitions executed orders (trades) into buy vs sell trades as well as large vs small amount trades. All values are per candleSize, so in a 60min interval on this example. The screenshot is self-explanatory, but the fields of most interest are:
    OrderPartitioner.png
    • averageTradeVolume: the average volume of a trade
    • buyCount and sellCount
    • volumeTradeList: the list of the biggest trades that happened within that candle
    • buySell: the ratio of buy vs sell trades
    • volumeBuySell: the ratio of buy vs sell trades weighted by their trade volume

Tips:

  • Look closely at the candles of the time you want to trade on with with VolumeSpike and/or PriceSpikes. Use tradingview.com or cryptowat.ch to configure the spike thresholds of your strategies according to your coin. They are useful for this because they can show the percentage movements of candles.
  • Aim for small profits between 1.5 and 3% and close your position quickly. Use a tight stop at about 1.5% (the lower end of your profit target). Markets will always have a pullback after a strong move and there is no way to be sure if the previous trend will continue or if this was just a stop-loss hunt and the trend will reverse.
  • Since during a spike you want to get your orders filled quickly, the default setting here is to place limit buy orders above the current rate (resp. sell orders below the current rate). Basically doing "safer" market orders that accept a worse price up to a certain point (configurable with the strongRate setting). This means there will always be slippage as you are chasing the orderbook, so you should use relatively small amounts compared to the amounts on the orderbook plus/minus 2% of the current price. Position sizes up to 200$ are generally safe for top 100 market cap coins.


The trading idea behind it:

You want to automatically trade (or just get notified) if there are price and/or volume spikes that are x times stronger than the average. WolfBot lets you fine-tune and automate these spikes per coin and makes sure you never miss one.
Additionally the IntervalExtremes and OrderPartitioner strategies can give you valuable insights into what type of traders with what amounts are currently in the market.
 
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