Component:Signal Generation - Revision history

152.57.38.103 at 22:24, 10 January 2026

2026-01-10T22:24:06Z

← Older revision		Revision as of 22:24, 10 January 2026
Line 97:		Line 97:
	</pre>		</pre>

	=== Gate 3: Direction Determination ===		=== Gate 3: Direction Determination ===

	Direction is determined by MA21 slope with 1H → 15m fallback:		Direction is determined by MA21 slope with 1H → 15m fallback:

	<pre>		<pre>
	trend_direction = market_state.trend_direction		trend_direction = market_state.trend_direction

	IF trend_direction == "up":		IF trend_direction == "up":
	direction = LONG // MA21 rising → trade long		direction = LONG // MA21 rising → trade long

	ELIF trend_direction == "down":		ELIF trend_direction == "down":
	direction = SHORT // MA21 declining → trade short		direction = SHORT // MA21 declining → trade short

	ELSE:		ELSE:
	// MA21 flat/unclear → use MTF fallback		// MA21 flat/unclear → use MTF fallback
	IF mtf_direction == "up":		IF mtf_direction == "up":
	direction = LONG		direction = LONG
	ELIF mtf_direction == "down":		ELIF mtf_direction == "down":
	direction = SHORT		direction = SHORT
	ELSE:		ELSE:
	// TICKET-22: 1H → 15m fallback (matches TimeframeSettings)		// TICKET-22: 1H → 15m fallback (matches TimeframeSettings)
	// Config: primary=1H, confirmation=15m, wait_for_15min_alignment=True		// Config: primary=1H, confirmation=15m, wait_for_15min_alignment=True

	one_hour_dir = timeframe_results['1h'].direction		one_hour_dir = timeframe_results['1h'].direction
	fifteen_min_dir = timeframe_results['15m'].direction		fifteen_min_dir = timeframe_results['15m'].direction

	// Priority 1: 1H + 15m agreement (strongest)		// Priority 1: 1H + 15m agreement (strongest)
	IF one_hour_dir == fifteen_min_dir AND one_hour_dir IN ['up', 'down']:		IF one_hour_dir == fifteen_min_dir AND one_hour_dir IN ['up', 'down']:
	direction = LONG if one_hour_dir == 'up' else SHORT		direction = LONG if one_hour_dir == 'up' else SHORT

	// Priority 2: 1H only (primary_timeframe)		// Priority 2: 1H only (primary_timeframe)
	ELIF one_hour_dir IN ['up', 'down']:		ELIF one_hour_dir IN ['up', 'down']:
	direction = LONG if one_hour_dir == 'up' else SHORT		direction = LONG if one_hour_dir == 'up' else SHORT

	// Priority 3: 15m only (confirmation_timeframe)		// Priority 3: 15m only (confirmation_timeframe)
	ELIF fifteen_min_dir IN ['up', 'down']:		ELIF fifteen_min_dir IN ['up', 'down']:
	direction = LONG if fifteen_min_dir == 'up' else SHORT		direction = LONG if fifteen_min_dir == 'up' else SHORT

	ELSE:		ELSE:
	RETURN None // ALL timeframes sideways → true consolidation		RETURN None // ALL timeframes sideways → true consolidation
	</pre>		</pre>

	'''Direction Hierarchy:'''		'''Direction Hierarchy:'''
	# MA21 slope (5min) - primary		# MA21 slope (5min) – primary
	# MTF primary_direction - first fallback		# MTF primary_direction – first fallback
	# 1H + 15m agreement - strongest MTF signal		# 1H + 15m agreement – strongest MTF signal
	# 1H only - primary_timeframe fallback		# 1H only – primary_timeframe fallback
	# 15m only - confirmation_timeframe fallback		# 15m only – confirmation_timeframe fallback
	# None - only if all sideways (true consolidation)		# None – only if all sideways (true consolidation)

	=== Gate 4: Probability Zone Filter ===		=== Gate 4: Probability Zone Filter ===

152.57.38.103 at 22:22, 10 January 2026

2026-01-10T22:22:33Z

← Older revision		Revision as of 22:22, 10 January 2026
Line 97:		Line 97:
	</pre>		</pre>

	=== Gate 3: Direction Determination ===		=== Gate 3: Direction Determination ===

	Direction is determined by MA21 slope with 1H → 15m fallback:		Direction is determined by MA21 slope with 1H → 15m fallback:

152.57.38.103 at 22:21, 10 January 2026

2026-01-10T22:21:55Z

← Older revision		Revision as of 22:21, 10 January 2026
Line 99:		Line 99:
	=== Gate 3: Direction Determination ===		=== Gate 3: Direction Determination ===

	Direction is determined by MA21 slope:		Direction is determined by MA21 slope with 1H → 15m fallback:

	<pre>		<pre>
	trend_direction = market_state.trend_direction		trend_direction = market_state.trend_direction

	IF trend_direction == "up":		IF trend_direction == "up":
	direction = LONG // MA21 rising → trade long		direction = LONG // MA21 rising → trade long

	ELIF trend_direction == "down":		ELIF trend_direction == "down":
	direction = SHORT // MA21 declining → trade short		direction = SHORT // MA21 declining → trade short

	ELSE:		ELSE:
	// MA21 flat/unclear → use MTF fallback		// MA21 flat/unclear → use MTF fallback
	IF mtf_direction == "up":		IF mtf_direction == "up":
	direction = LONG		direction = LONG
	ELIF mtf_direction == "down":		ELIF mtf_direction == "down":
	direction = SHORT		direction = SHORT
	ELSE:		ELSE:
	RETURN None // ~~No clear direction~~ → ~~no trade~~		// TICKET-22: 1H → 15m fallback (matches TimeframeSettings)
	</pre>		// Config: primary=1H, confirmation=15m, wait_for_15min_alignment=True

			one_hour_dir = timeframe_results['1h'].direction
			fifteen_min_dir = timeframe_results['15m'].direction

			// Priority 1: 1H + 15m agreement (strongest)
			IF one_hour_dir == fifteen_min_dir AND one_hour_dir IN ['up', 'down']:
			direction = LONG if one_hour_dir == 'up' else SHORT

			// Priority 2: 1H only (primary_timeframe)
			ELIF one_hour_dir IN ['up', 'down']:
			direction = LONG if one_hour_dir == 'up' else SHORT

			// Priority 3: 15m only (confirmation_timeframe)
			ELIF fifteen_min_dir IN ['up', 'down']:
			direction = LONG if fifteen_min_dir == 'up' else SHORT

			ELSE:
			RETURN None // ALL timeframes sideways → true consolidation
			</pre>

			'''Direction Hierarchy:'''
			# MA21 slope (5min) - primary
			# MTF primary_direction - first fallback
			# 1H + 15m agreement - strongest MTF signal
			# 1H only - primary_timeframe fallback
			# 15m only - confirmation_timeframe fallback
			# None - only if all sideways (true consolidation)

	=== Gate 4: Probability Zone Filter ===		=== Gate 4: Probability Zone Filter ===

152.57.36.146 at 00:18, 10 January 2026

2026-01-10T00:18:48Z

← Older revision		Revision as of 00:18, 10 January 2026
Line 23:		Line 23:

	----		----

	~~=== The Asymmetric Probability Edge ===~~

	~~When odds are low on one outcome, '''the opposite side usually carries high odds''':~~
	* If new high probability drops to 15%, then '''85% odds favor reversal'''
	* We position ourselves on the high-probability side

	== Decision Flow ==		== Decision Flow ==

152.57.36.146 at 00:18, 10 January 2026

2026-01-10T00:18:20Z

← Older revision		Revision as of 00:18, 10 January 2026
Line 23:		Line 23:

	----		----

			=== The Asymmetric Probability Edge ===

			When odds are low on one outcome, '''the opposite side usually carries high odds''':
			* If new high probability drops to 15%, then '''85% odds favor reversal'''
			* We position ourselves on the high-probability side

	== Decision Flow ==		== Decision Flow ==

Plusev.blr at 20:33, 7 January 2026

2026-01-07T20:33:31Z

← Older revision		Revision as of 20:33, 7 January 2026
Line 266:		Line 266:

	----		----

	~~== Quick Reference ==~~

	~~{\| class="wikitable"~~
	\|-
	~~! Scenario !! Result~~
	\|-
	~~\| Grade C, D, or F \|\| No signal (rejected)~~
	\|-
	~~\| Hour = 9, 22, or 23 \|\| No signal (blocked hour)~~
	\|-
	~~\| MA21 rising \|\| LONG signal only~~
	\|-
	~~\| MA21 declining \|\| SHORT signal only~~
	\|-
	~~\| MA21 flat, MTF unclear \|\| No signal (no direction)~~
	\|-
	~~\| LONG in bottom third \|\| Allowed (high prob)~~
	\|-
	~~\| LONG in top third \|\| Blocked (low prob)~~
	\|-
	~~\| SHORT in top third \|\| Allowed (high prob)~~
	\|-
	~~\| SHORT in bottom third \|\| Blocked (low prob)~~
	\|}

Plusev.blr at 20:30, 7 January 2026

2026-01-07T20:30:17Z

← Older revision		Revision as of 20:30, 7 January 2026
Line 14:		Line 14:
	== Trading Market Principle ==		== Trading Market Principle ==

	'''"Trade with the trend, not against it~~. MA21 slope is your compass.~~"'''		'''"Trade with the trend, not against it"'''

	* MA21 rising = LONG only → don't fight a rising market		* MA21 rising = LONG only → don't fight a rising market

Plusev.blr at 20:29, 7 January 2026

2026-01-07T20:29:35Z

← Older revision		Revision as of 20:29, 7 January 2026
Line 7:		Line 7:
	This component is the decision maker. It receives graded setups from Layer 3 and decides:		This component is the decision maker. It receives graded setups from Layer 3 and decides:
	# Should we take this trade? (passes all gate filters)		# Should we take this trade? (passes all gate filters)
	# Which direction? (LONG or SHORT ~~based on MA21 slope~~)		# Which direction? (LONG or SHORT)
	# Where to enter, stop, and exit? (entry techniques)		# Where to enter, stop, and exit? (entry techniques)

Plusev.blr: Created page with "= Signal Generation & Trade Management = == Purpose == '''"Should we trade? Which direction? Where's entry/stop/target?"''' This component is the decision maker. It receives graded setups from Layer 3 and decides: # Should we take this trade? (passes all gate filters) # Which direction? (LONG or SHORT based on MA21 slope) # Where to enter, stop, and exit? (entry techniques) ---- == Trading Market Principle == '''"Trade with the trend, not against it. MA21 slope is..."

2026-01-07T20:28:19Z

Created page with "= Signal Generation & Trade Management = == Purpose == '''"Should we trade? Which direction? Where's entry/stop/target?"''' This component is the decision maker. It receives graded setups from Layer 3 and decides: # Should we take this trade? (passes all gate filters) # Which direction? (LONG or SHORT based on MA21 slope) # Where to enter, stop, and exit? (entry techniques) ---- == Trading Market Principle == '''"Trade with the trend, not against it. MA21 slope is..."

New page

= Signal Generation & Trade Management =

== Purpose ==

'''"Should we trade? Which direction? Where's entry/stop/target?"'''

This component is the decision maker. It receives graded setups from Layer 3 and decides:
# Should we take this trade? (passes all gate filters)
# Which direction? (LONG or SHORT based on MA21 slope)
# Where to enter, stop, and exit? (entry techniques)

----

== Trading Market Principle ==

'''"Trade with the trend, not against it. MA21 slope is your compass."'''

* MA21 rising = LONG only → don't fight a rising market
* MA21 declining = SHORT only → don't catch falling knives
* MA21 flat = use MTF direction as tiebreaker
* Gate filters protect capital → blocked hours, wrong zone, weak confirmation = skip
* Only high-quality setups traded → A+, A, B grades only

----

== Decision Flow ==

<pre>
┌─────────────────────────────────┐
│ Setup Quality Result (Layer 3) │
│ Grade: A+/A/B/C/D/F │
└─────────────────────────────────┘
│
▼
┌─────────────────────────────────┐
│ GATE 1: Grade Filter │
│ Only A+, A, B pass │
│ C, D, F → REJECTED │
└─────────────────────────────────┘
│
▼
┌─────────────────────────────────┐
│ GATE 2: Hour Filter │
│ Blocked: 9 AM, 10 PM, 11 PM │
│ (Loss-making hours) │
└─────────────────────────────────┘
│
▼
┌─────────────────────────────────┐
│ GATE 3: Direction Determination│
│ MA21 rising → LONG │
│ MA21 declining → SHORT │
│ Flat/unclear → NO TRADE │
└─────────────────────────────────┘
│
▼
┌─────────────────────────────────┐
│ GATE 4: Probability Zone Filter│
│ Top third + LONG = OK │
│ Bottom third + LONG = BLOCKED │
│ (Trades with probability) │
└─────────────────────────────────┘
│
▼
┌─────────────────────────────────┐
│ Calculate Entry/Stop/Target │
│ Generate Signal │
└─────────────────────────────────┘
</pre>

----

== Gate Filters ==

=== Gate 1: Grade Filter ===

Only high-quality setups are traded:

{| class="wikitable"
|-
! Grade !! Action
|-
| A+, A, B || PASS → Generate signal
|-
| C, D, F || BLOCKED → No signal generated
|}

=== Gate 2: Hour Filter ===

Block historically loss-making hours:

<pre>
Blocked Hours: [9, 22, 23] // 9 AM, 10 PM, 11 PM IST

IF current_hour IN blocked_hours:
RETURN None // No signal
</pre>

=== Gate 3: Direction Determination ===

Direction is determined by MA21 slope:

<pre>
trend_direction = market_state.trend_direction

IF trend_direction == "up":
direction = LONG // MA21 rising → trade long

ELIF trend_direction == "down":
direction = SHORT // MA21 declining → trade short

ELSE:
// MA21 flat/unclear → use MTF fallback
IF mtf_direction == "up":
direction = LONG
ELIF mtf_direction == "down":
direction = SHORT
ELSE:
RETURN None // No clear direction → no trade
</pre>

=== Gate 4: Probability Zone Filter ===

Filters trades based on price position within range:

{| class="wikitable"
|-
! Zone !! LONG !! SHORT !! Logic
|-
| Top Third || Blocked || Allowed || 80% continuation down, 15% up
|-
| Middle Half || Allowed || Allowed || Neutral zone
|-
| Bottom Third || Allowed || Blocked || 80% continuation up, 15% down
|}

'''Sideways Market Exception:''' In creeper/consolidation, uses mean reversion (opposite logic).

----

== Stop Loss Calculation ==

Stop placement based on entry technique:

{| class="wikitable"
|-
! Entry Technique !! LONG Stop !! SHORT Stop
|-
| GREEN_BAR_PULLBACK || Below pullback low || Above rally high
|-
| BREAKOUT_PULLBACK || min(last 3 lows) || max(last 3 highs)
|-
| MA_BOUNCE || MA21 - 5 points || MA21 + 5 points
|-
| BOS_ENTRY || min(last 10 lows) + buffer || max(last 10 highs) - buffer
|-
| DISCOUNT_ZONE || entry × 0.99 || entry × 1.01
|-
| DEFAULT || entry - 40 points || entry + 40 points
|}

'''Minimum Stop Distance:''' 40 points (prevents tight stops hitting on noise)

----

== Take Profit Calculation ==

Implements "cut the move in half" principle:

<pre>
distance_to_ma = |entry_price - MA21|
target_distance = distance_to_ma × 0.5

IF LONG:
take_profit = entry_price + target_distance
ELSE:
take_profit = entry_price - target_distance
</pre>

'''Minimum R:R:''' 1.5 (target must be at least 1.5× risk)

----

== Cost Calculations ==

=== Commission (Dhan Broker) ===

<pre>
commission = position_size × Rs 20 per lot
</pre>

=== CTT (Commodity Transaction Tax) ===

<pre>
contract_value = entry_price × lot_size × position_size
tax = contract_value × 0.0001 // 0.01% total (0.005% per leg)
</pre>

----

== Configuration ==

{| class="wikitable"
|-
! Parameter !! Value !! Description
|-
| <code>commission_per_lot</code> || 20.00 || Rs per lot (Dhan)
|-
| <code>transaction_tax_rate</code> || 0.00005 || 0.005% per leg × 2 = 0.01% CTT
|-
| <code>lot_size_multiplier</code> || 100 || MCX lot size
|-
| <code>min_stop_distance</code> || 40 || Minimum stop in points
|-
| <code>default_risk_reward</code> || 1.5 || Minimum R:R ratio
|-
| <code>enable_hour_filter</code> || True || Block loss-making hours
|-
| <code>blocked_hours</code> || [9, 22, 23] || Hours to skip
|-
| <code>enable_ma_direction_filter</code> || True || MA21 alignment required
|-
| <code>enable_probability_zone_filter</code> || True || Zone probability check
|-
| <code>enable_color_change_filter</code> || False || Disabled (too restrictive)
|}

----

== Output ==

'''Signal Object:'''
{| class="wikitable"
|-
! Field !! Type !! Description
|-
| <code>direction</code> || Enum || LONG or SHORT
|-
| <code>entry_price</code> || float || Current close price
|-
| <code>stop_loss_price</code> || float || Calculated stop level
|-
| <code>take_profit_price</code> || float || Calculated target level
|-
| <code>position_size</code> || int || From setup quality (1 or 2 lots)
|-
| <code>setup_quality</code> || Enum || A+, A, or B
|-
| <code>entry_technique</code> || Enum || How stop was determined
|}

----

== Dependencies ==

'''Upstream:'''
* [[Component:Multi_Timeframe_Analysis|multi_timeframe_analysis.py]] - MTF direction fallback
* [[Component:Market_State_Analysis|market_state_analysis.py]] - Trend direction, market state
* [[Component:Setup_Quality_Detection|setup_quality_detection.py]] - Grade, position size

'''Internal:'''
* [[Component:Probability_Zone|probability_zone_analysis.py]] - Zone filtering logic

'''Downstream:'''
* [[Component:Trade_Execution|trade_execution_engine.py]] - Executes the signal

----

== Quick Reference ==

{| class="wikitable"
|-
! Scenario !! Result
|-
| Grade C, D, or F || No signal (rejected)
|-
| Hour = 9, 22, or 23 || No signal (blocked hour)
|-
| MA21 rising || LONG signal only
|-
| MA21 declining || SHORT signal only
|-
| MA21 flat, MTF unclear || No signal (no direction)
|-
| LONG in bottom third || Allowed (high prob)
|-
| LONG in top third || Blocked (low prob)
|-
| SHORT in top third || Allowed (high prob)
|-
| SHORT in bottom third || Blocked (low prob)
|}