generating-trading-signals

# Generating Trading Signals ## Overview Multi-indicator signal generation system that analyzes price action using 7 technical indicators and produces composite BUY/SELL signals with confidence scores and risk management levels. **Indicators Used:** - RSI (Relative Strength Index) - Overbought/oversold - MACD (Moving Average Convergence Divergence) - Trend and momentum - Bollinger Bands - Mean reversion and volatility - Trend (SMA 20/50/200 crossovers) - Trend direction - Volume - Confirmation of moves - Stochastic Oscillator - Short-term momentum - ADX (Average Directional Index) - Trend strength ## Prerequisites Install required dependencies: ```bash pip install yfinance pandas numpy ``` Optional for visualization: ```bash pip install matplotlib ``` ## Instructions ### Step 1: Quick Signal Scan Scan multiple assets for trading opportunities: ```bash python {baseDir}/scripts/scanner.py --watchlist crypto_top10 --period 6m ``` Output shows signal type (STRONG_BUY/BUY/NEUTRAL/SELL/STRONG_SELL) and confidence for each asset. ### Step 2: Detailed Signal Analysis Get full indicator breakdown for a specific symbol: ```bash python {baseDir}/scripts/scanner.py --symbols BTC-USD --detail ``` Shows each indicator's contribution: - Individual signal (BUY/SELL/NEUTRAL) - Indicator value - Reasoning (e.g., "RSI oversold at 28.5") ### Step 3: Filter and Rank Signals Find the best opportunities: ```bash # Only buy signals with 70%+ confidence python {baseDir}/scripts/scanner.py --filter buy --min-confidence 70 --rank confidence # Rank by most bullish python {baseDir}/scripts/scanner.py --rank bullish # Save results to JSON python {baseDir}/scripts/scanner.py --output signals.json ``` ### Step 4: Use Custom Watchlists Available predefined watchlists: ```bash python {baseDir}/scripts/scanner.py --list-watchlists python {baseDir}/scripts/scanner.py --watchlist crypto_defi ``` Watchlists: `crypto_top10`, `crypto_defi`, `crypto_layer2`, `stocks_tech`, `etfs_major` ## Output ### Signal Summary Table ``` ================================================================================ SIGNAL SCANNER RESULTS ================================================================================ Symbol Signal Confidence Price Stop Loss -------------------------------------------------------------------------------- BTC-USD STRONG_BUY 78.5% $67,234.00 $64,890.00 ETH-USD BUY 62.3% $3,456.00 $3,312.00 SOL-USD NEUTRAL 45.0% $142.50 N/A -------------------------------------------------------------------------------- Summary: 2 Buy | 1 Neutral | 0 Sell Scanned: 3 assets | [timestamp] ================================================================================ ``` ### Detailed Signal Output ``` ====================================================================== BTC-USD - STRONG_BUY Confidence: 78.5% | Price: $67,234.00 ====================================================================== Risk Management: Stop Loss: $64,890.00 Take Profit: $71,922.00 Risk/Reward: 1:2.0 Signal Components: ---------------------------------------------------------------------- RSI | STRONG_BUY | Oversold at 28.5 (< 30) MACD | BUY | MACD above signal, positive momentum Bollinger Bands | BUY | Price near lower band (%B = 0.15) Trend | BUY | Uptrend: price above key MAs Volume | STRONG_BUY | High volume (2.3x) on up move Stochastic | STRONG_BUY | Oversold (%K=18.2, %D=21.5) ADX | BUY | Strong uptrend (ADX=32.1) ---------------------------------------------------------------------- ``` ### Signal Types | Signal | Score | Meaning | |--------|-------|---------| | STRONG_BUY | +2 | Multiple strong buy signals aligned | | BUY | +1 | Moderate buy signals | | NEUTRAL | 0 | No clear direction | | SELL | -1 | Moderate sell signals | | STRONG_SELL | -2 | Multiple strong sell signals aligned | ### Confidence Interpretation | Confidence | Interpretation | |------------|----------------| | 70-100% | High conviction, strong signal | | 50-70% | Moderate conviction | | 30-50% | Weak signal, mixed indicators | | 0-30% | No clear direction, avoid trading | ## Configuration Edit `{baseDir}/config/settings.yaml`: ```yaml indicators: rsi: period: 14 overbought: 70 oversold: 30 signals: weights: rsi: 1.0 macd: 1.0 bollinger: 1.0 trend: 1.0 volume: 0.5 ``` ## Error Handling See `{baseDir}/references/errors.md` for common issues: - API rate limits - Insufficient data handling - Network errors ## Examples See `{baseDir}/references/examples.md` for detailed examples: - Multi-timeframe analysis - Custom indicator parameters - Combining with backtester - Automated scanning schedules ## Integration with Backtester Test signals historically: ```bash # Generate signal python {baseDir}/scripts/scanner.py --symbols BTC-USD --detail # Backtest the strategy that generated the signal python {baseDir}/../trading-strategy-backtester/skills/backtesting-trading-strategies/scripts/backtest.py \ --strategy rsi_reversal --symbol BTC-USD --period 1y ``` ## Files | File | Purpose | |------|---------| | `scripts/scanner.py` | Main signal scanner | | `scripts/signals.py` | Signal generation logic | | `scripts/indicators.py` | Technical indicator calculations | | `config/settings.yaml` | Configuration | ## Resources - yfinance for price data - pandas/numpy for calculations - Compatible with trading-strategy-backtester plugin