Support Resistance Spot Trading Strategy

The method simply involves buying at the support level and selling at the resistance level. To customize this approach, you can set a designated range from the support and resistance levels for trading.

To better understand this strategy, it is important to comprehend the concept of support and resistance levels in trading. A support level refers to a price point where there is an anticipated increase in demand, causing the asset's price to halt its decline or bounce back up. Resistance level, on the other hand, is a price point where there is expected to be a significant surge in supply, leading to the asset's price decreasing or facing a pullback.

In technical analysis, traders use support and resistance levels to predict potential price movements of an asset. By identifying these key levels, traders can make informed decisions about when to enter or exit trades. This method involves monitoring an asset's price movements and buying when it reaches the support level and selling when it reaches the resistance level.

How to work with it

Buy method conditions

A buy order is placed when price is within SupRes_SPREAD % from support.

tip

This strategy can buy multiple times, it can be capped with SupRes_MAX.

Sell method conditions

A sell order is placed when price is within SupRes_SPREAD % from resistance, and additionally the set gain % is reached.

danger

Gain protection is optional for this strategy. Be aware that this can lead to sell orders below your break-even point.

How to work with this strategy

There is just a single setting that defines the entry point for this strategy: SupRes_SPREAD

This setting represents a percentage (of price) above the first support level (when buying), or below the first resistance level (when selling). As soon as price crosses this threshold, it will place an order. If the balance settings allow for multiple orders, a buy order gets placed every time the buy conditions are met.

In the example below, SupRes_SPREAD is set to 0.1, the "buy at" line visualizes the target. The sell target would be 0.1 % below the first resistance level.

Keep in mind that support and resistance are not static targets. This makes the SupRes_SPREAD setting more or less a trailing range. It's very important to set a value that makes sense for the current pair and the price range it is in: too big of a spread can cause immediate trades.

The strategy sells when price crosses SupRes_SPREAD and GAIN is reached.

Formula

Gunbot uses the following formula to calculate support and resistance levels. The number of candles uses as input is user configurable with the SMAPERIODsetting.

P = (H + L + C) / 3 
R1 = (P  2) - L 
R2 = P + (H - L) 
S1 = (P  2) - H 
S2 = P - (H - L)

Less options than usual

This strategy is a bit different from other strategies, it has much less configurable options. Confirming indicators or additional trailing are disabled.

Strategy settings for SupportResistance

Buy settings

Label	Config Parameter	Default Value	Detailed Description
Allow Buy Orders	BUY_ENABLED	true	Enables you to allow buy orders within this trading strategy. When set to true, the strategy can initiate buy orders based on other configured settings.
Support/Resistance Spread	SupRes_SPREAD	0.1	Sets the minimum percentage range from the first detected support or resistance level within which no orders will be placed. This applies to both buy and sell orders, ensuring that they are executed only after this buffer zone is maintained. The value represents a percentage of the price.
Maximum Buys	SupRes_MAX	0	Use this setting to cap the number of times the strategy is allowed to execute buy orders. If the sum of your quote balance, value of open orders, and the upcoming order exceeds this set limit, further buy orders will not be placed. This is useful for managing exposure and budget.

Sell settings

Label	Config Parameter	Default Value	Detailed Description
Allow Sell Orders	SELL_ENABLED	true	Enables you to allow sell or short orders within this trading strategy. When enabled, it allows for the initiation of sell orders based on other strategy parameters.
Gain Target	GAIN	1	Defines the target gain percentage above the break-even point for sell orders. This setting helps you to set profit targets, where a sell order will be executed once this gain target is achieved, relative to the buying price.
Sell Order Limit	COUNT_SELL	9999	Limits the number of sell orders that can be placed for a trading pair, effective from the time the pair was added. This can help manage frequent trading on volatile pairs, ensuring a cap on the number of transactions.

Indicators

Label	Config Parameter	Default Value	Detailed Description
Candlestick Period	PERIOD	15 minutes	Specifies the duration of candlesticks used for the calculation of various indicators. This setting should align with the time frames supported by your exchange. The value is denoted in minutes, representing the candlestick period.
SMA Period	SMAPERIOD	30	Determines the number of candlesticks used to calculate the Simple Moving Average, which is part of the Bollinger Bands, trend watcher, support and resistance, and Fibonacci retracements. This provides a basis for various trend and volatility assessments in the strategy.

Overview of effects on different order types

Config Parameter	Affected Order Types	Not Affected Order Types
Buy Enabled	Strategy buy, DCA buy, RT buy, RT buyback	Strategy sell, Stop limit, Close, RT sell
Sell Enabled	Strategy sell, Stop limit, RT sell	Strategy buy, RT buy, RT buyback, Close, DCA buy
Gain	Strategy sell	Strategy buy, RT buy, RT buyback, RT sell, Close, DCA buy, Stop limit
Sup / Res Spread	Strategy sell, Strategy buy	Stop limit, RT sell, RT buy, RT buyback, Close, DCA buy
Sup / Res Max	Strategy sell, Strategy buy	Stop limit, RT sell, RT buy, RT buyback, Close, DCA buy
Period	Strategy sell, Strategy buy, DCA buy (trigger)	RT buy, RT buyback, RT sell, Close, Stop limit
SMA Period	Strategy sell, Strategy buy	RT buy, RT buyback, RT sell, Close, Stop limit, DCA buy order