Signal Settings

Overview

The Signal Settings for Lune Aegis allow you to control the generation and behavior of trade entry signals. These settings provide a high degree of customization, letting you fine-tune the strategy’s responsiveness to different market conditions. By adjusting lookback periods, sensitivity, and various thresholds, you can tailor the signal logic to fit your specific trading style and the market you are analyzing.

Signal Generation Logic

To protect our proprietary algorithms, the exact mechanics of the signal logic are not disclosed. However, the conceptual approach can be understood as follows:

Lune Aegis uses a sophisticated, multi-model system to identify trading opportunities. The strategy first analyzes the current market environment to classify it into a specific "regime"—such as trending, mean-reverting, or highly volatile.

Based on this real-time classification, the strategy then uses a specialized analytical model best suited for that particular market condition. This adaptive approach, which is based on analyzing differences in market movement, ensures the signal logic remains effective and relevant as market behavior changes. All signals are confirmed on the close of a price bar to ensure they do not repaint.

Settings

The following settings control the core logic of the signal engine.

General Settings

Setting	Description
Long Trades	Enables or disables the generation of long (buy) signals.
Short Trades	Enables or disables the generation of short (sell) signals.

Core Lookback Periods

These settings define the main timeframes used for market analysis.

Setting	Description	Range / Recommended
Short-Term Lookback	Sets the period for short-term market analysis. Lower values are more sensitive to immediate price changes.	Range: 1 - 2000 Recommended: 5 - 25
Medium-Term Lookback	Sets the period for medium-term pattern and volatility analysis.	Range: 1 - 2000 Recommended: 15 - 50
Long-Term Lookback	Sets the period for long-term statistical analysis, which helps establish a baseline for market behavior.	Range: 1 - 2000 Recommended: 100 - 500

Signal Sensitivity & Thresholds

These settings adjust the strategy's overall responsiveness and the confirmation level required to generate a signal.

Setting	Description	Range / Recommended
Signal Sensitivity	Controls the overall frequency of signals. Higher values lead to more signals with lower confirmation requirements.	Range: 1 - 100 Recommended: 30 - 70
Momentum Threshold	Sets the confirmation level for signals based on market momentum. Higher values require stronger momentum.	Range: 0.1 - 5.0 Recommended: 1.5 - 3.0
Reversion Threshold	Sets the confirmation level for signals based on mean reversion. Higher values require a stronger reversion setup.	Range: 0.1 - 5.0 Recommended: 1.5 - 3.0
Volatility Threshold	Sets the confirmation level for signals based on market volatility. Higher values require a stronger volatility setup.	Range: 0.1 - 5.0 Recommended: 2.0 - 4.0

Regime Detection Parameters

These settings influence how the strategy identifies the current market state (regime).

Setting	Description	Options / Recommended
Data Source	Selects the price data used for calculations.	close hlc3 hlcc4 ohlc4
Trend Lookback	Sets the period used for analyzing trend strength.	Range: 1 - 2000 Recommended: 10 - 30
Risk Lookback	Sets the period for risk and anomaly analysis.	Range: 1 - 2000 Recommended: 15 - 40
Momentum Lookback	Sets the period for momentum calculations.	Range: 1 - 2000 Recommended: 15 - 40
Detrend Lookback	Sets the period for the detrending process in signal analysis.	Range: 1 - 2000 Recommended: 30 - 100

Advanced Threshold Configuration

These settings define the thresholds for classifying the market into different regimes.

Setting	Description	Range / Recommended
High Volatility Threshold	Sets the percentile for detecting a high-volatility environment.	Range: 0.01 - 0.99 Recommended: 0.65 - 0.85
Low Volatility Threshold	Sets the percentile for detecting a low-volatility environment.	Range: 0.01 - 0.99 Recommended: 0.25 - 0.50
High Trend Threshold	Sets the level for detecting a strong trending environment.	Range: 0.01 - 0.99 Recommended: 0.40 - 0.70
Low Trend Threshold	Sets the level for detecting a weak or non-trending environment.	Range: 0.01 - 0.99 Recommended: 0.20 - 0.40
Anomaly Threshold	Sets the threshold for detecting anomalous or unusual market conditions.	Range: 0.5 - 10.0 Recommended: 3.0 - 6.0

Best Practices & Usage

• Balance Sensitivity and Confirmation: Lowering threshold values or increasing Signal Sensitivity will generate more signals but may also increase the number of false positives. Higher values will provide stronger confirmation but may result in fewer trading opportunities. Find a balance that suits your risk tolerance.

• Adjust Lookbacks for Your Timeframe: If you are trading on a lower timeframe, consider using shorter Lookback periods to make the strategy more responsive. For higher timeframes, longer Lookback periods can provide more stable and reliable signals.

• Tune One Thing at a Time: When optimizing the settings, adjust only one parameter at a time. This will help you clearly understand the effect of each change on the strategy's performance during backtesting.

• Start with Recommended Values: The recommended values provide a solid starting point for most markets. Use them as a baseline and then carefully adjust them based on the specific asset and timeframe you are trading.