This strategy is a result of a study to understand better the workings of functions, for loops and the use of lines to visualize price levels. The strategy is a complete rewrite of the older RSI+PA+DCA Strategy with the goal to make it dynamic and to simplify the strategy settings to the bare minimum.
In case you are not familiar with the older RSI+PA+DCA Strategy, here is a short explanation of the idea behind the strategy:
The idea behind the strategy based on an RSI strategy of buying low. A position is entered when the RSI and moving average conditions are met. The position is closed when it reaches a specified take profit percentage. As soon as the first the position is opened multiple PA (price average) layers are setup based on a specified percentage of price drop. When the price hits the layer another position with the same position size is is opened. This causes the average cost price (the white line) to decrease. If the price drops more, another position is opened with another price average decrease as result. When the price starts rising again the different positions are separately closed when each reaches the specified take profit. The positions can be re-opened when the price drops again. And so on. When the price rises more and crosses over the average price and reached the specified Stop level (the red line) on top of it, it closes all the positions at once and cancels all orders. From that moment on it waits for another price dip before it opens a new position.
This is the old RSI+PA+DCA Strategy:
The reason to completely rewrite the code for this strategy is to create a more automated, adaptable and dynamic system. The old version is static and because of the linear use of code the amount of DCA levels were fixed to max 6 layers. If you want to add more DCA layers you manually need to change the script and add extra code. The big difference in the new version is that you can specify the amount of DCA layers in the strategy settings. The use of 'for loops' in the code gives the possibility to make this very dynamic and adaptable.
The RSI code is adapted, just like the old version, from the RSI Strategy - Buy The Dips by Coinrule and is used for study purpose. Any other low/dip finding indicator can be used as well
The distance between the DCA layers are calculated exponentially in a function. In the settings you can define the exponential scale to create the distance between the layers. The bigger the scale the bigger the distance. This calculation is not working perfectly yet and needs way more experimentation. Feel free to leave a comment if you have a better idea about this.
The idea behind generating DCA layers with a 'for loop' is inspired by the Backtesting 3commas DCA Bot v2 by rouxam.
The ideas for creating a dynamic position count and for opening and closing different positions separately based on a specified take profit are taken from the Simple_Pyramiding strategy I wrote previously.
This code is a result of a study and not intended for use as a full functioning strategy. To make the code understandable for users that are not so much introduced into pine script (like myself), every step in the code is commented to explain what it does. Hopefully it helps.
Enjoy!
In case you are not familiar with the older RSI+PA+DCA Strategy, here is a short explanation of the idea behind the strategy:
The idea behind the strategy based on an RSI strategy of buying low. A position is entered when the RSI and moving average conditions are met. The position is closed when it reaches a specified take profit percentage. As soon as the first the position is opened multiple PA (price average) layers are setup based on a specified percentage of price drop. When the price hits the layer another position with the same position size is is opened. This causes the average cost price (the white line) to decrease. If the price drops more, another position is opened with another price average decrease as result. When the price starts rising again the different positions are separately closed when each reaches the specified take profit. The positions can be re-opened when the price drops again. And so on. When the price rises more and crosses over the average price and reached the specified Stop level (the red line) on top of it, it closes all the positions at once and cancels all orders. From that moment on it waits for another price dip before it opens a new position.
This is the old RSI+PA+DCA Strategy:
The reason to completely rewrite the code for this strategy is to create a more automated, adaptable and dynamic system. The old version is static and because of the linear use of code the amount of DCA levels were fixed to max 6 layers. If you want to add more DCA layers you manually need to change the script and add extra code. The big difference in the new version is that you can specify the amount of DCA layers in the strategy settings. The use of 'for loops' in the code gives the possibility to make this very dynamic and adaptable.
The RSI code is adapted, just like the old version, from the RSI Strategy - Buy The Dips by Coinrule and is used for study purpose. Any other low/dip finding indicator can be used as well
The distance between the DCA layers are calculated exponentially in a function. In the settings you can define the exponential scale to create the distance between the layers. The bigger the scale the bigger the distance. This calculation is not working perfectly yet and needs way more experimentation. Feel free to leave a comment if you have a better idea about this.
The idea behind generating DCA layers with a 'for loop' is inspired by the Backtesting 3commas DCA Bot v2 by rouxam.
The ideas for creating a dynamic position count and for opening and closing different positions separately based on a specified take profit are taken from the Simple_Pyramiding strategy I wrote previously.
This code is a result of a study and not intended for use as a full functioning strategy. To make the code understandable for users that are not so much introduced into pine script (like myself), every step in the code is commented to explain what it does. Hopefully it helps.
Enjoy!
Versionshinweise:
It was a bit of a headache, but I think I found a more elegant way to calculate the exponential DCA layers. The base number is calculated based on the max amount of DCA layers and the range between the entry price and 0. With this method the DCA layers never will be negative. The more layers you set the more the exponential layers get squeezed between the range limit of the entry price and 0.
I also added the option to switch to a linear calculation of the DCA layers. Enjoy!
I also added the option to switch to a linear calculation of the DCA layers. Enjoy!