From d0719be5fe43478689c0decb4ea2c4e54417978d Mon Sep 17 00:00:00 2001 From: taniman Date: Sun, 22 Oct 2017 00:23:49 +0200 Subject: [PATCH] Created ANDERSON DCA strategy (markdown) --- ANDERSON-DCA-strategy.md | 89 ++++++++++++++++++++++++++++++++++++++++ 1 file changed, 89 insertions(+) create mode 100644 ANDERSON-DCA-strategy.md diff --git a/ANDERSON-DCA-strategy.md b/ANDERSON-DCA-strategy.md new file mode 100644 index 0000000..3082643 --- /dev/null +++ b/ANDERSON-DCA-strategy.md @@ -0,0 +1,89 @@ +# Anderson DCA Strategy + +### So how does ANDERSON-DCA Strategy works? +You first need to setup your tier triggers, you can list as many as you want. +We will use the following as an example for DCA.properties configuration + +`enabled = true` +`max_cost = 0` +`max_buy_times = 5` +`buy_strategy = ANDERSON` +`buy_style = DOUBLEDOWN` +`buy_trigger_1 = -3.5` +`buy_trigger_2 = -4.5` +`buy_trigger_3 = -4.5` +`buy_trigger_4 = -5.5` +`buy_trigger_5 = -5.5` +`sell_strategy = GAIN` +`sell_value = 0.8` +`sell_trigger = 0.8` +`max_buy_spread = 2` +`trailing_profit = 0.2` +`trailing_buy = 0.3` +`stop_loss_trigger = 0` +`pending_order_wait_time = 0` +`ignore_sell_only_mode = false` +`min_buy_balance = 0` + + + +### We will use BTC-QTUM for this example +Let's say our bot purchased 0.36458333 units of QTUM at a price of 0.00192000 and the price starts to fall +Once the price falls below -3.5% (0.00185280) it will hit our first trigger as defined above and we will double our units +Since we have 0.36458333 units of QTUM, the boy proceed and buy another 0.36458333 units at the current price +Let's say the price is currently 0.00185280. +After this purchase goes thru, we will have 0.72916666 units of QTUM +Average Buy price 0.00188640 + +**For trigger 2** to kick in, the price would have to drop -4.5% (0.00180151) of our latest average price buy (0.00188640) +The bot again will double our units +Since we have 0.72916666 units of QTUM, the bot will proceed and buy another 0.72916666 units at the current price +Let's say the price is currently 0.00180151 +After this purchase goes thru, we will have 1.45833332 units of QTUM +Average Buy price 0.00184396 + +**For trigger 3** to kick in, the price would have to drop -4.5% (0.00176098) of our latest average price buy (0.00184396) +The bot again will double our units +Since we have 1.45833332 units of QTUM, the bot will proceed and buy another 1.45833332 units at the current price +Let's say the price is currently 0.00176098 +After this purchase goes thru, we will have 2.91666664 units of QTUM +Average Buy price 0.00180247 + +**For trigger 4** to kick in, the price would have to drop -5.5% (0.00170333) of our latest average price (0.00180247) +The bot again will double our units +Since we have 2.91666664 units of QTUM, the bot will proceed and buy another 2.91666664 units at the current price +Let's say the price is currently 0.00170333 +After this purchase goes thru, we will have +5.83333328 units of QTUM +Average Buy price 0.00175290 + +**For trigger 5** to kick in, the price would have to drop -5.5% (0.00165649) of our latest average price (0.00175290) +The bot again will double our units +Since we have 5.83333328 units of QTUM, the bot will proceed and buy another 5.83333328 units at the current price +Let's say the price is currently 0.00165649 +After this purchase goes thru, we will have 11.66666656 units of QTUM +Average Buy price 0.00170469 + +If the pair does 5 DCA buys, it means that the original price we bought 0.00192000 has fallen around 14% since we bought If we hadn’t done any DCA buy, we would have to wait for this pair to gain those 14% back in order to break even, that might take a long time + +While with DCA, our new average price would be 0.00170469, that means that with a little spike in price 3-4% we would be able to sell our “bag + +***WARNING*** +To use DCA you have to adjust your initial ALL_max_cost on pair files +Remember that each time ANDEERSON DCA makes a buy it will double your current units +That means it will use a lot of BTC, therefore, you MUST consider usin a low `ALL_max_cost` + +### Example +If your max cost is: +ALL_max_cost = 0.0007 +If you have to DCA 5 times, you will have spent total around 0.022 BTC + +### A simple and safe math you can do is + +1 DCA = initial trade x 2 = Total BTC to be used +2 DCA = initial trade x 4 = Total BTC to be used +3 DCA = initial trade x 8 = Total BTC to be used +4 DCA = initial trade x 16 = Total BTC to be used +5 DCA = initial trade x 32 = Total BTC to be used +6 DCA = initial trade x 64 = Total BTC to be used +7 DCA = initial trade x 128 = Total BTC to be used \ No newline at end of file