The "bollinger" strategy is a trading strategy implemented in the Freqtrade bot. It utilizes technical analysis indicators, specifically Bollinger Bands and Exponential Moving Average (EMA), to generate buy and sell signals for trading. The strategy aims to achieve a minimal return on investment (ROI) of 0.2.
It uses a stop loss of -0.10, meaning that if the price of an asset decreases by 10% from the entry point, the bot will sell the asset to limit potential losses.
The strategy operates on 1-hour candlestick data (ticker interval) and uses the "stop" order type for both buying and selling.
It employs the "gtc" (good 'til canceled) time in force for orders, indicating that the orders remain active until executed or manually canceled. In terms of indicators, the strategy calculates Bollinger Bands using a window length of 70 and standard deviation of 2. Bollinger Bands consist of an upper band, middle band (simple moving average), and lower band, which help identify potential overbought and oversold conditions in the market. Additionally, the strategy calculates the Exponential Moving Average (EMA) with the same length as the Bollinger Bands. The EMA is a trend-following indicator that smooths out price data to identify the overall direction of the market. To generate buy signals, the strategy checks for a crossover above the upper Bollinger Band or if the closing price is higher than the upper band. When these conditions are met, a buy signal is generated. For sell signals, the strategy checks for a crossover below the EMA or if the closing price is lower than the EMA. When these conditions are met, a sell signal is generated. Overall, the strategy aims to capture potential price movements based on Bollinger Bands and EMA indicators, buying when the price shows strength and selling when the price shows weakness.