How to pick pairs for Bot trading with the UCTS indicator?

Market is flooded with pairs to trade and it could be a little hard sometimes to understand which pairs could be a good pick for trading bot.

The idea of this article is to serve as guidance, since the examples I will mention in this post may become irrelevant or outdated as time moves on.

Define what type of pairs are you willing to trade?

Are you a BTC holder trying to acquire more sats? Or do you want to trade against USD pairs?

There is no correct answer here, but its important to understand where do you want to sit before starting to set up bots, since they will need funds to run.

I’m a BTC longtime hodler and my idea is to trade /BTC pairs with the sats I have on my trading account in order to get more sats.

But its also a good option to have USD (in any of their multiple stable options) and trade pairs against it.
If market goes bananas, you will be sitting in stables most of the time and you will also have funds to “buy the dip” and move sats into cold storage.

Once you decide on which pairs you feel more comfortable, is time to move into backtesting!

Backtest the market pairs:

Past does not predict future but its a good metric to take in count when setting up a bot.
A pair that is always doing crazy movements, hard to predict and that has a poor backtesting record, it can be a riskier setup for a bot.

Where to check backtesting results?
two options:

How to backtest with the UCTS on tradingview?

Just add the backtesting version of the UCTS to your regular chart and you will find the information at the bottom of the screen.
Changing the settings/timeframe or pair, will reload the new values for the signals on the chart.

What is important for a bot as backtesting results?

I try to focus on 3 metrics for picking up a new bot

  • # of trades on the selected timeframe already executed by the bot: Results that are based on 1 or 2 trades are less reliable than pairs with 10/20 or 30 trades
  • Profit factor: “The profit factor is defined as the gross profit divided by the gross loss (including commissions) for the entire trading period. This performance metric relates the amount of profit per unit of risk, with values greater than one indicating a profitable system.”
    Basically the higher the better, higher than 1 is a must, higher than 2 is what you are looking for most of the time.
  • Percent profitable: How many trades were profitable from the total?
    Let say that a pair has 10 trades already with the UCTS & profit factor is 5. That looks great BUT percent profitable is 10% (that means that 1/10 trades were profitable)
    Thats not good, it probably means that the pair have a specific trade that went bananas and that specific trade is covering the other 9 wrong trades that the pair offered. I would avoid this kind of pair.

Set up your pairs on a 3rd party app to start trading with bots

I recommend 3commas, it has been working perfectly over the last 3 years
Here is a guide on how to set up bots there:
https://cryptontez.medium.com/set-up-a-3commas-bot-with-ucts-indicator-ac4eb20ab035

Some examples of pairs that I run with the UCTS indicator:

  • BTC/USDT (no brainer here)
    profit factor above 5
    Percent profitable above 50%
    Total trades >20
  • ETH/BTC
    profit factor above 5
    Percent profitable above 50%
    Total trades >15
  • ADA/BTC
    profit factor above 7
    Percent profitable above 50%
    Total trades >20

You get the idea?

Hope it helps!
Happy trading!

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CryptoNTez

CryptoNTez

Bitcoin guardian and Pine Script enthusiast. Main developer of the Excel Trading Bot for Crypto. Check my trading scripts here: cryptontez.com