At launch, we introduced Strategy Templates — an easy and intuitive feature for new and experienced traders to run advanced strategies and test the power of automated, algorithmic trading strategies against the crypto market. The DPP Platform launched with five strategy templates (Arbitrage, Smart Order Routing, Market Making, EMA Crossover, and ETF 5 Crypto). We had some great feedback from you regarding this feature. Today we’re happy to introduce four additional templates that can help you take your crypto trading to the next level: Stochastic Oscillator, Bollinger Bands, RSI, and Directional Movement.
To make the DPP Platform as approachable as possible, we created Strategy Templates. Strategy Templates are advanced ready-to-use strategies that you can start running with just a few clicks. They’re great for new crypto traders or anyone just looking to jump in and quickly try strategy creation. When paired with our Forward Test feature (read more here), Strategy Templates are an excellent way for new traders to learn risk-free without putting any real digital assets on the line. Forward testing Strategy Templates can help you learn how markets react to certain trading strategies and better understand how different strategies can be tweaked to achieve a specific goal. Whether you’re a day trader or still learning the ins and outs of the crypto market, strategy templates are the perfect way to try the DPP Platform and discover the power of algorithmic trading in crypto.
This strategy uses the Stochastic Oscillator technical indicator, an indicator which determines overbought and oversold conditions in the market. The default time period used is 14 days, but this can be changed within node settings (Technical Indicator Node). This strategy combines Exponential Moving Average with Stochastic Oscillator, creating a buy signal when the price is lower than 200 periods of the Exponential Moving Average and the Stochastic value indicates the asset is oversold. The sell signal is created when the price is higher than 200 periods of the Exponential Moving Average and the Stochastic indicates the asset is overbought.
This strategy uses the Bollinger Bands technical indicator. This is one of the most popular Technical Indicators due to its simplicity. The outer Bollinger Bands are usually 2 standard deviations away from the mean. Buying the breaks of the lower Bollinger Band is a way to take advantage of oversold conditions. Usually, once a lower band has been broken due to heavy selling, the price of the asset will revert back above the lower band and head toward the middle band which creates a buy signal for this strategy. The opposite occurs for the sell signal — once the price breaks the upper band due to heavy buying, a sell signal is created. This is an example of a short-term “buy low, sell high” trading strategy.
Relative Strength Index (RSI)
RSI is one of the main oscillators used in technical analysis. This indicator helps assess price movement against previous values. The RSI is usually used to spot points at which the market is overbought and oversold. It also can be used to detect price reversals and detect the beginning of a new trend. Standard overbought and oversold levels are considered to be 70 and 30. If the indicator’s value goes above the 70 level, it signals that the market is overbought and the trend may reverse downwards. If the indicator’s line goes below 30, it signifies the market is oversold and the trend may reverse upwards. The values for oversold and overbought can be adjusted. This strategy can be used to explore exact values for overbought and oversold market conditions.
The Average Directional Index (ADX) is a technical indicator that measures the strength of a trend. Usually, strategies using this indicator are set-up to trade when there’s a crossover of the directional movement lines (+DI and -DI) by checking the ADX value to confirm the strength of a trend. The usual threshold for when an ADX signal there’s a buying or selling trend is considered to be above 25. When the +DI line crosses above the -DI line, this means the market is in an uptrend, and therefore if the -DI line crosses above the +DI line, the market is in a downtrend. This is the process used by the Directional Movement strategy template to create buy/sell signals.
Automated asset management
Traders can also use some of these strategy templates for asset management. The Stochastic Oscillator, Bollinger Bands, and RSI strategy templates give you the versatility to incorporate asset management within these strategies. This is done through the Strategy Assets Node (read more about available Nodes here). This was the primary motivation behind developing the Strategy Assets Node. Using the Strategy Assets Node, traders can take profit or loss with any strategy created on the DPP Platform, providing new opportunities for achieving bigger returns and limiting human error through advanced automation.
Let’s take a deeper dive into how the Strategy Asset Node works with certain strategies. Your strategy’s performance is dependent on position package size. For example, you can create strategies that manage all the digital assets available on your account, buying or selling your account’s assets instead of a fixed size of a position. The advantage of this approach is that it provides the potential to optimize profit. Using the Strategy Assets Node, you can also take profit or loss while trading, minimizing the risk of a strategy automatically maintaining complete control of your account’s assets.
For example, if a strategy starts to become unprofitable, positions can be closed in order to preserve your account’s digital assets. On the other hand, if the strategy is profitable, positions can be closed to take profit and protect your assets and thereby your trading capital.
An additional use-case for the Strategy Assets Node is for distributing orders throughout any given timeframe. An example of this would be asset accumulation over the desired time period.
Performing a single all-in with buy orders are not considered an effective trading method due to daily price fluctuations and the potential impact this could have on the market. As a result, one of the possible advantages of using the Strategy Node can be to distribute orders during a select time-frame. This can be done in select portions of your account’s assets, thereby ensuring your trading strategy is less predictable to other competitors in the market.
Digital Assets Power Play (DPP) is a leading provider of the most advanced algorithmic crypto trading platform and services on the market, including the DPP Platform and DataStreams. Our goal is to empower crypto traders and allow anyone to trade like a pro using the power of algorithmic trading.
The DPP Platform is an intuitive algorithmic strategy creator connecting crypto traders to 14,000+ markets across more than 100 exchanges, and making advanced automated trading tools accessible and user-friendly for anyone. Easily create, backtest, forward test, and run multiple automated trading strategies across several crypto exchanges. The DPP Platform provides access to comprehensive market overview features, data streaming, historical data, forward testing, portfolio management, and more. Enterprise-level data streaming and historical data services are also available with DPP DataStreams and DPP Historical.
Sign-up for the DPP Platform, invite friends, and start earning immediately with our referral program!