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The DIV_v1 trading strategy is designed to identify and exploit bullish divergence patterns in the market. Here's a breakdown of how the strategy works:
Timeframe and Data Requirements:
The strategy operates on 5-minute candlestick data. It requires a minimum of 200 startup candles for accurate analysis.
It processes only new candles, ignoring previously processed data.
Indicators: Relative Strength Index (RSI): The strategy calculates the RSI with a time period of 14.
Divergence Detection: The strategy employs a custom function called "divergence" to detect bullish divergence. Bullish divergence occurs when the price makes a lower low (LL) while the RSI makes a higher low (HL). The function marks the LL points on the price chart ("ohlc_bottom") and the corresponding HL points on the RSI chart ("rsi_bottom"). It then scans for instances where there is no conflicting price movement between the LL and HL points. If such conditions are met, the function identifies a bullish divergence and sets the "bullish_divergence" flag to True. Buy and Sell Conditions: The strategy generates buy signals when the following conditions are met simultaneously: Bullish divergence is detected (bullish_divergence == True). RSI is below 30. Volume is greater than 0. The strategy does not specify any sell conditions. Risk Management: The strategy sets a minimal return on investment (ROI) of 5% ("minimal_roi") and a stop loss of -5% ("stoploss"). It enables trailing stop functionality, which dynamically adjusts the stop loss as the price moves favorably. The trailing stop starts at a positive offset of 0.001 and triggers the stop loss when the price retraces 2% from the highest point reached after triggering the stop loss. Visualization: The strategy provides plot configurations to visualize the detected divergence and RSI values on the price and RSI charts, respectively. Please note that this is a brief summary of the DIV_v1 strategy, and for a comprehensive understanding, it's recommended to review the entire code and consult the strategy's author, Sanka.
It processes only new candles, ignoring previously processed data.
Indicators: Relative Strength Index (RSI): The strategy calculates the RSI with a time period of 14.
Divergence Detection: The strategy employs a custom function called "divergence" to detect bullish divergence. Bullish divergence occurs when the price makes a lower low (LL) while the RSI makes a higher low (HL). The function marks the LL points on the price chart ("ohlc_bottom") and the corresponding HL points on the RSI chart ("rsi_bottom"). It then scans for instances where there is no conflicting price movement between the LL and HL points. If such conditions are met, the function identifies a bullish divergence and sets the "bullish_divergence" flag to True. Buy and Sell Conditions: The strategy generates buy signals when the following conditions are met simultaneously: Bullish divergence is detected (bullish_divergence == True). RSI is below 30. Volume is greater than 0. The strategy does not specify any sell conditions. Risk Management: The strategy sets a minimal return on investment (ROI) of 5% ("minimal_roi") and a stop loss of -5% ("stoploss"). It enables trailing stop functionality, which dynamically adjusts the stop loss as the price moves favorably. The trailing stop starts at a positive offset of 0.001 and triggers the stop loss when the price retraces 2% from the highest point reached after triggering the stop loss. Visualization: The strategy provides plot configurations to visualize the detected divergence and RSI values on the price and RSI charts, respectively. Please note that this is a brief summary of the DIV_v1 strategy, and for a comprehensive understanding, it's recommended to review the entire code and consult the strategy's author, Sanka.
stoploss: -0.05 timeframe: 5m hash(sha256): fa98a90300d6454f971c8b05d26642eccab411d4953c53ac949de7810943b6f8 indicators: rsi_bottom hidden_bullish_divergence volume ohlc_bottom bullish_divergence close rsi source
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last change: 2022-07-26 16:26:40