This video shows you how to build an advanced bot that opens positions in a variety of market conditions.
This is an excellent example of how you can leverage the power of emotionless bots to create a mechanical, systematic trading portfolio.
The Honey Badger bot uses two technical indicators to determine if a security is overbought or oversold.
If the underlying security is oversold, the bot will open a short put spread. If it is overbought, the bot will open a short call spread. If the security is neither overbought nor oversold, the bot will open a neutral iron condor.
New Bot (:41)
Create a new bot, give it a name, and set allocation and position limits in the global bot settings.
The bot will have no activity, positions, or automations. As a safeguard, the bot is turned off by default, and you must manually turn it on when you are ready.
Add a New Scanner Automation (1:20)
Scanner automations tell the bot what market criteria to look for before entering a new position.
This bot uses one scanner automation to make multiple complex decisions and enter different strategy types.
To add a new scanner automation, select the “+” symbol in the Scanners section of the Automations tab.
When adding an automation, you have the option to reuse an automation, make a copy and modify an existing automation, or create a new automation.
A new automation will be made for this example.
Select “New Automation” to access the automation editor. You can name the automation and add specific criteria for the bot.
The new scanner can be added to your automations library, where it can be edited, copied, and reused in the future.
Add Decision Actions to the Automation Editor (1:51)
The Honey Badger scanner’s objective is to open a new position. The automation will first go through a number of decision criteria and technical indicator filters to determine what position type to open.
Select the “+” icon to access the decision action recipes. Decision actions tell the bot what criteria to look for to find opportunities.
There are multiple recipes to choose from when using decision actions. For this example, the bot will evaluate two technical indicators when proceeding through the automation.
The fields are variable, so you can define the parameters to fit your trading strategy.
You can also use custom inputs for certain fields. Custom inputs provide you flexibility if the automation is used again. The input enables you to set a variable, label it, and change it at the automation level. A custom input is used for the ticker symbol in this bot.
The bot will first check if the underlying symbol’s 14-day RSI is above 70. You can select the “+” symbol to add an and/or function.
The bot will also check if the ticker’s 14-day CCI is above 150. The same ticker can be used by linking the custom input to the second decision recipe.
The first thing the bot will do is check if the ticker symbol’s 14-day RSI is above 70 and the 14-day CCI is above 150.
Because the “And” function is enabled, both criteria must be true for the bot to continue down the “Yes” path of the automation.
Select “Save” to display the completed decision recipe in the automation editor.
Add Additional Decision Actions (4:28)
If both criteria are not true, a decision action can be added to the “No” branch of the automation editor.
The first two recipes evaluate if the security is overbought. The decision action under the “No” branch can reference if the ticker is oversold.
The same two technical indicators will be used. The bot will check if the 14-day RSI is below 30 and the 14-day CCI is below -150.
Select “Save,” and the automation editor displays the completed decision recipe.
The bot will determine if the underlying ticker symbol is overbought or oversold based on the provided criteria.
Open Position Actions (5:57)
You can tell the bot to open positions based on the decision actions’ outcome.
For example, if the first recipe is true and the ticker is overbought, the bot can open a short call spread.
To open a position, select the “+” symbol under the “Yes” branch of the automation editor to view the list of bot actions.
Select “Open Position” to view the list of position types.
The open position action tells the bot to open a short call spread if the ticker’s 14-day RSI is above 70 and the 14-day CCI is above 150.
Remember, you can link the ticker symbol to the same custom input in the automation.
You can customize the credit spread’s specifications, including the expiration date, option leg details, and contract size.
Select “Save” to add the action to the automation editor.
Simply repeat the process to open a short put spread if the ticker is oversold.
If neither decision action proceeds down the “Yes” path and the ticker is not overbought or oversold, a neutral iron condor can be opened.
Add another open position action, select “Iron Condor,” and customize the position. Select “Save” to add the open position action to the “No” branch.
The scanner automation is now complete. The bot will check if the underlying security is overbought or oversold, and one of three position types will be opened based on the technical indicators’ values.
You can view the automation’s inputs and opportunities on the left side of the editor.
When you exit the automation editor, the scanner’s details are displayed, including the automaton’s custom inputs. You can always edit the custom inputs’ values here at the automation level.
The scanner automation can be seen in the bot’s dashboard. Remember, the bot and automations are still turned off.
Reusing a Scanner Automation (8:39)
You can easily reuse the same automation and simply change the ticker symbol through the custom input. The same decision criteria will be used on a different ticker symbol.
You can add multiple scanners with different ticker symbols. The custom input field flows through the automation and changes dynamically based on the assigned input.
This is a great example of how custom inputs are flexible and efficient when adding automations to a bot.
Hover the mouse over the “i” icon to display the custom input used in that automation.
Add Multiple Monitor Automations (9:21)
Monitor automations manage open positions inside a bot. Monitor automations only activate once a position is opened.
You can add a monitor automation. The Honey Badger Bot has the potential to enter three different position types: a short put spread, a short call spread, and an iron condor. So, there must be a monitor automation to manage each respective position.
Select the “+” symbol in the Monitors section to create a new automation or select from a list of available automations in your library.
There is already a manager for each position type saved in the list of automations, so we can select each and add it to the bot.
You can always copy an automaton, make modifications, and save it as a new automation with different criteria. For example, you could change exit parameters such as profit-taking.
Remember, if you reuse and edit an automation, the edits will transfer everywhere the automation is used. Copying creates a new automation.
The bot is now complete with a comprehensive scanner automation and three monitor automations to manage each position type.
Turn the bot on when you are ready.