11 Mar Signals data science powered algorithmic crypto trading signals
There has been a transformation in financial markets and trading over the past couple of decades where traditional trading is being replaced by algorithmic trading systems.
Currently there is no widely available solution for algorithmic crypto trading for users who want to be able to “set it and forget it” as opposed to being tied to the market constantly to adhere to their trading rules.
Signals Nework is a new blockchain project that plans to democratize machine learning and algorithmic trading for crypto traders to make smarter and faster trades.
Throughout the ico frenzy of 2017 there were a number of platforms claiming to be using Artificial Intelligence (AI) and Algorithmic Trading to earn investors daily “interest” payments. Many of these have exit scammed and none of them transparently proved to be using algorithmic trading to produce investor returns.Signals is not one of these money grabs.
Signals is a data-centric platform and marketplace where data science and programming professionals can share their data and strategies for users to use to trade with their own holdings.
“Our mission is to empower crypto traders with state of the art algorithms from the data science community, which will allow them to optimize their profits.
The Signals Platform provides these tools in a user-friendly way. From advanced charting and classic technical indicators to complex statistical models, crowd wisdom based inputs and machine learning algorithms based on media monitoring and sentiment analysis.
The Signals Platform is a place where anybody can create fully customizable trading robots with no advanced technical knowledge required.”
Why Machines and Algorithmic Trading?
Machines take emotions and other psychological factors out of trading,turning it into a numbers game.Cognitive biases sometimes interfere with trading decisions, especially if a trader does not have a well-structured trading plan.
As traders use trading signals to make decisions, cognitive biases still weigh heavy on the decisions they take.Machines ignore the noise of trading signals and process more data than a normal human ever could in order to inform their decisions.
Computer algorithms can also execute trades infinitely faster than humans and never sleep, running 24/7.
How does Algorithmic Trading Work?
“Algorithmic trading” may seem like an intimidating term to many, so let’s break it down into simple terms and steps.DATA: First, you need to pick out a data set to serve as the foundation for further analysis.
- Example: specific trading pairs such as BTC/USD or LTC/BTC.
INDICATORS: Next, you need to choose the different types of indicators which act as filters for analyzing the data.
- Examples: trading volume, moving averages, support/resistance, etc.
STRATEGY: Lastly, a strategy should define the ways to use the indicators to trade the pairs you have selected.An algorithmic trading system will use these inputs to create a robust trading strategy, which can be tested and then used.
The Signals Algorithmic Trading Platform
The Signals platform has marketplaces where data, indicators and strategies can be put together into an automated trading strategy using their “Signals Strategy Builder”.Signals platform has a nice visual design and it’s very user-friendly so anyone can use it.
I cannot overemphasize how important this is for adoption, so Signals has done right here. If it’s not easy to use and nice to look at, unfortunately most users will probably overlook the technology behind a trading platform of this sort.
1) Data Marketplace
Users and external vendors provide data sets in the Data Marketplace.These data sets include historical and current market data, social network, and data from other crypto-related media and sites.
Any type of data set can be uploaded to the Data Marketplace and priced accordingly. Data crawlers that provide live data streams or API access can also be integrated easily.
2) Indicators Marketplace
Signals plans to include the following indicators in their platform:
Basic “Freemium” Indicators: I’m always amused when companies use this word.
“Freemium is a word companies use to make sure you understand what you are not paying for is valuable enough for you to pay for.. but lucky you. You’re getting it for free!Signal’s freemium indicators can monitor the price of a crypto and send signals based on “if-then” conditions.
Using the visual interface, users can combine basic strategies like stop losses together with proprietary Signals features like their ‘Flash crash detection system’.
Combining both can make for a more robust way to protect from downside risk.Technical analysis indicatorsTechnical analysis (TA) applies statistics to historical data to find patterns and trends in the market. As many crypto traders have found TA to be a useful tool for trading, they are also very useful when combined with machine learning technology for algorithmic trading.
Sentiment analysis indicators
Using natural language processing (or sentiment analysis) based on media monitoring is becoming a standard tool for analysis in the crypto world and other financial markets.The Signals Platform provides sentiment analysis indicators with data from social networks and crypto media.
Machine learning based indicators
Deep learning neural networks designed for processing time series, such as LSTM (long short term memory) recurrent neural networks
Crowd wisdom based indicators
Future economic trends can often be determined from surveying the masses.
This is basically how prediction markets work -they let users speculate on what they know (or think they know) by buying and selling stakes in the outcome of an event.
If they predict the outcome correctly, they make a profit; otherwise, they lose their money. The current price of event outcome (based on its probability) quantifies the knowledge of the crowd.
Blockchain monitoring indicators
Analysis to be conducted on the movement of every coin and token, especially those held by whales.
When most of the coins are held by whales, tools that monitor the blockchain for “whale” movements can signal when major holders are buying or selling.
Github commit indicators
Traders will be able to monitor Github updates on all coins and tokens they trade.
Developers and data scientists can monetize their skills by developing indicators to sell to Signals users.After a subscription fee set by the owner of the indicator is paid, these indicators can be used for free for testing and trading on the Signals Platform.
Using the Strategies Marketplace, developers and traders can list their trade strategies for copy trading and offer it to other users.Users will pay for receiving trading signals from a third-party bot, which can be traded through the platform.
Third party bots integration
Although signals is providing a tool for creating trading bots, other popular trading bots can be integrated into the Signals marketplace.This would be great for data scientists who can create trading algorithms but have no experience with UX design.
Signals Strategy Builder
The Signals Strategy Builder allows users to create their own trading strategies.There are two main components to each strategy — indicators and signals.
- Indicators are blocks of code selected from the Indicators Marketplace.
- Signals are actions that are triggered in response to indicators.
In the Signals Strategy Builder, users can drag and drop indicators and define the conditions of the indicators under which the signals should be triggered. Users can also create optimal
strategies and test them before using them for live trading.
Connections to crypto exchanges and mobile
Signals provides both a cloud based solution and an open source desktop app to perform automated trading in the background. The desktop version is important for traders who strongly prefer to store and encrypt their tokens on their own devices.
Trading bots can be connected to smartphones using the Signals app. Users can receive notifications whenever their strategy identifies a trading opportunity.
STOX crowd wisdom indicators will be integrated to let users create hybrid trading models combining machine learning with crowdsourced opinions.
iExec, a blockchain-based cloud computing platform, will solve complex computational problems while keeping things affordable for users.
SGN is an ERC-20 token built on the Ethereum blockchain. The Signals Platform will be accessible exclusively using Signal tokens.
Signals’ business model is based on two main revenue streams.
1) Signals charges a fee on each purchase in the Signals marketplaces.This includes: • Purchases of user-created indicators • Purchases of data streams • Renting of user-made strategies for copy trading
- Using premium machine learning features
- 2) The Signals cloud solution for deploying strategies.
- A subscription model will be implemented with different tiers based on the number of strategies used.
Like any platform, the success of Signals depends entirely on user adoption.The Signals team will set up transparent competitions using smart contracts and the results will be evaluated using publicly available data like strategy statistics and endorsements.
Indicators development competitions
The most successful strategies which are offered for copy trading to other traders will be selected based on publicly accessible statistics regarding the strategy’s performance, risk-taking or other parameters.
Each data source on the Signals platform will have public usage analytics.
The most useful data sources will be evaluated and supported with Signals
User endorsement competitions
Users that contribute to the community by answering questions and sharing their knowledge to earn points based on positive reviews. This is the main metric that will be used to reward active users.
The Signals token sale begins March 12th
20% of Signals’ tokens are reserved for users and early adopters.There will be a maximum of $18M worth of SGN sold during this phase.
• SGN prices are nominated in ETH before the beginning of the token sale
• At the beginning of this phase, there will be a 15% discount on the first token sold,
which will then gradually decrease, with the last token sold having no discount.
• Minimum transaction amount in Ethereum is 0.1 ETH.
A trading platform that leverages real data science using both technical/statistical analysis and natural language processing, or sentiment analysis can be a very useful tool for crypto traders.
Currently some of the most trusted trading bots run solely on trading strategies set using technical analysis indicators. These bots do not get smarter as they do when machine learning is used to refine and adapt strategies to changing market conditions.
Although trading bots provide the advantage to traders to not have to constantly be monitoring the markets, the strategies do need to be monitored and changed at times when settings are no longer optimal.
Machine learning takes things to the next level for those wanting to truly “set it and forget it” with algorithmic trading.
Signals network is addressing a major pain point for traders and has a solid plan to execute their solution for it.
For this reason I am supporting the project and will update periodically as the project progresses through major milestones in the roadmap.
You can sign up for the free airdrop using this link.To earn airdrop tokens you will need to go through some actions like twitter following, facebook liking, etc.How to participate in the token sale & token sale info
Always Do Your Own Research. Hold on for dear life.