Signal Settings

Overview

The Signal Settings for Lune Momento 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 by leveraging an advanced, statistics-based engine. By configuring the analysis windows and adjusting sensitivity, 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 Momento uses a sophisticated statistical model to identify trading opportunities. The strategy analyzes a wide range of market characteristics, such as volatility, trend persistence, and the shape of the price distribution. It then classifies the market into distinct regimes (e.g., bullish trend, bearish trend, or ranging) to understand the current environment.

The model calculates a risk-adjusted signal score based on the agreement of these different statistical factors. This score is then adjusted based on the identified market regime. This adaptive approach 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.

Sensitivity & Analysis

These settings define how the statistical engine analyzes the market and its overall responsiveness.

Setting	Description	Range / Recommended
Signal Sensitivity	Controls the overall responsiveness and frequency of signals. Lower values are more sensitive and produce more signals, while higher values provide stronger filtering for fewer, higher-quality signals.	Range: 0.1 - 10.0 Recommended: 1.0 - 3.0
Volatility Lookback	Sets the lookback window for volatility calculations. A lower value is more responsive to short-term volatility changes.	Range: 5 - 2000 Recommended: 15 - 50
Return Lookback	Sets the lookback window for price return calculations. A lower value is more sensitive to recent price movements.	Range: 5 - 2000 Recommended: 8 - 25
Skewness Lookback	Sets the lookback window for analyzing the asymmetry of the price distribution, which is used in regime detection.	Range: 5 - 2000 Recommended: 20 - 50
Regime Change Sensitivity	The threshold for detecting shifts between different market regimes (e.g., from trending to ranging). Lower values are more sensitive to change.	Range: 0.01 - 1.0 Recommended: 0.2 - 0.5

Best Practices & Usage

• Balance Sensitivity and Confirmation: Lowering Signal Sensitivity will generate more signals but may also increase the number of false positives. Higher values 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.

• 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.

• 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.