Documentation - Bearish Mode - How it operates

Technical Overview: Bearish Trading Mode

The Bearish Mode is the highest-risk strategy available in the system. When enabled, the AI executes a high volume of quick transactions to capture micro-profits in declining or volatile markets.

RSI-Driven Strategy & Logic

The core indicator governing Bearish Mode is the Relative Strength Index (RSI):

• Dual-RSI Setup: The strategy combines 1 short-term RSI and 1 extra-long-term RSI, using the long-term indicator to guide overall buy and sell decisions.

• Execution Rules:

  • Low RSI: Indicates an oversold market and triggers Buy orders.

  • High RSI: Indicates an overbought market and triggers Sell orders.

• Timeframes & Recalculation: RSI values are calculated across second- and minute-level timeframes and update every minute.

• Mean Reversion: When price action becomes stagnant, the RSI naturally drifts back toward the 50 mark (neutral zone).

Bearish Mode Execution & Dynamic Risk Controls

To optimize high-frequency execution during Bearish Mode, trade sizing and dynamic multipliers are strictly managed to account for exchange transaction fees and prevent capital erosion.

Sizing Mechanics & Dynamic Multipliers

• Micro-Position Sizing: Individual trade sizes are intentionally kept small to mitigate risk across a high volume of transactions and ensure trading fees do not consume overall profits.

• Balance Ratio Scaling: Position sizes dynamically scale based on your account balance ratio and current price velocity. If a negative price ratio triggers a sell signal, the script increases the sell volume to exit positions faster.

• Moving Average Multipliers: When prolonged upward or downward trends are detected via moving averages, a percentage multiplier increases position sizing to capitalize on momentum.

Safety Limits & Risk Mitigation

• Operating Hours Cutoff: Because trading volume and price action often decline toward the end of the day, an operating time limit can automatically halt trading and convert active holdings to cash/stablecoins.

• Top-Level Range Limits: Restricts buy orders to local support levels. The top-level limit calculates a price floor based on the daily high-low variance range:

  Example: If an asset's daily price range is $100 (e.g., Low: $1,000, High: $1,100), a 25% Top-Level Limit restricts buys to prices below $1,025 (Daily Low + 25% of the range), ensuring positions are opened near bottom-level prices.

• Minimal Filter Constraints: Standard safety filters are bypassed in Bearish Mode to allow rapid trading execution. However, custom risk limits can be re-enabled for extra protection.

Optimal Market Conditions

Bearish Mode performs best in low-volatility markets with tight consolidation ranges, where predictable micro-fluctuations allow the bot to repeatedly execute profitable short trades.

Source : tradingapi

Price: $ 00.00 CAD to access tradingapi extensions, forum support, chatbox support and update support