Quote from: eduk on May 12, 2013, 03:10:11 PM

Hi all, I'm new to Bitcointalk been waiting hours to get out of newbie mode to post this. Yesterday I spent quite a long times learning the inner workings of this bot, I took TobbeLino's version and have made some modifications to attempt to start making the bot a bit smarter.

I have added some volatility data with a volatility buy threshold/sell threshold that must also be passed before a trade is executed.

The volatility data is worked out by taking X amount of samples (which you can set in options) and then finding the lowest and highest sample from within them. The lowest is then taken away from the highest to give the difference. This volatility score is the added to the volatility score from a couple of samples ago and divided by 2 to smooth it out slightly.

Whether this is the best way of working out volatility, I'm not sure. I found this true range and average true range from this link and basically simplified it http://stockcharts.com/school/doku.php?id=chart_school:technical_indicators:average_true_range_atr

So if anyone has any ideas how to improve this volatility score, just let me know.

Also please test it with small amounts as I've only been using it for 5 minute samples so far, there have also been some changes to the section which determines whether to execute a trade and so use at your own risk. I used this morning and it made a sell at 11:40 BST as in image below.

http://i.imgur.com/N3zkxVu.png

Options have been added to set it up. I'm liking the look of 3 volatility samples with about a 0.9 to 1.2 threshold on each. I believe that this volatility check will also allow you to lower the main buy sell thresholds.

Download: https://mega.co.nz/#!k9EERBpI!fr0EdklaQIZPyfVqF7C-aRYeBRwkqc0bdzbitz4Xho4
(Copy/Paste this as forum screwed it up)

As a bonus I have also added a sound notification so that when a trade gets made you can hear it happening.

@TobbeLino, if you like this update, feel free to add to it to your GitHub / improve upon it or contact me.

Thanks! I'll have to think about this before adding it to my bot...
My spontaneous reaction is that this seems to a over-simplistic way to get a volatility indicator (but I'm no expert in this), so it will not be very reliable. Each sample is only ONE single trade on ONE point in time, so you are only looking at three trades (out of all hundreds or thousands that take place during an interval). Maybe for very short intervals you could get some useful data if you're lucky, but with trading intervals of 30 minutes or more (or even 15 minutes) I'm think that your volatility indicatior will not reflect the true volatility.

Personally, I'm also a bit sceptical about using volatility as an indicator at all (at least in this way).
I'd much rather use a volume indicator. But to implement that, the bot needs to fetch a whole different kind of data (total volume between sample intervals for instance).

I see mostly "Jr. Members" (including me) commenting and suggesting features for the bot - are there anyone who actually know the theories here? Unfortunately I think that MtGox APIs (which are not very good in my opinion) will probably limit how complex indicators this bot can calculate.

In general, I think that there seems to be some misconceptions of what to expect from a trading bot.
A bot is not a "magic money making machine"

Any bot (or human) will make bad trades sometimes - no matter how "smart" it is.
But the goal is that it should be able to make more good trades than bad trades, and that it will make money, slowly, steadily in the long run. And I don't think it's possible to just "speed up" the process and make more money in shorter time, simply by setting a shorter sample interval - the trading fees will probably take all your profit away.

But as I've said before: I'm better at programming and software development that at trading - thats why I need a bot!

So if there are any true experts here with real experience with designing trading bot strategies, please feel free to comment!