Avorak AI is creating a full market analysis trading bot that works in the same way a traditional trader would work. In the development stage, historical price action is analyzed for 19 indicators encompassing candlestick patterns, strength indexes, volume profiles, order book activity, and more. The number of indicators used may be decreased before the beta period begins depending on the judged usefulness of the indicators.
The accuracy of historical potential trades is calculated to weigh up the ‘relative strength’ of these indicators vs. the others towards trade success percentage.
To determine the success of each indicator, they are analyzed for four aspects of success:
- how long after the indicator triggers a signal before the anticipated price movement
- the change in volume across multiple timescale averages
- the percentage of price movement from the indicator trigger point (this assists with recalculating entry points, stop losses, and leverage multiplier if applicable and creates a unique profile for each asset)
- for trend reversals indicators, how long the trend continues after the indicator triggers before starting the reversal
Once automated trading is live, the success of actual trades made will be marked as more useful information to the bot than the success of theoretical trades.
In the current stage, the trading bot is providing only raw data as the retail-oriented UI has not been completed and linked yet.
Statistics from 3 months of tests show a slow increase in both percentage profitability and win rate as the systems continue to learn and analyze the most suitable trading routes, with around a 59% win ratio.
Currently, the trading bots are only being developed in a ‘scalping’ mode, designed for lower timeframe trading between a few minutes to around a three-day maximum market exposure.
Swing-style trading bot development will begin after the ‘scalp’ public beta has already been launched, with a view to having this as a second beta test around two months after.
Credits will need to be deposited in advance to use the trading bot features, as 0.5% of all trade profit is the fee for the service. As the bot will be unable to access withdrawal functions of the user’s CEX account or wallet used for DEX, advanced credit deposit ensures no fee debt is created. Unused credits can be withdrawn at any time without charge at the market rate for AVRK at the time of withdrawal.
These fees will be routed through the revenue distribution system, as outlined in the previous medium article.
Limited places will be given for the closed beta access in addition to trading funds provided by Avorak. These funds can be kept by the closed beta testers as a ‘thank you’ for providing feedback to Avorak in the development stage. Applications for beta testers will be taken in June 2023.