ATR Spaced Market Making and Bollinger Band Reversion on DEXs

Summary

This tutorial demonstrates simple strategies on the WOOFi and EdgeX decentralized exchanges. Its WOOFi example refreshes orders, positions, depth, and account equity, then places layered buy and sell orders around the best prices. Average True Range sets the spacing, while the order routine uses existing opposite-side inventory for closing before it opens additional exposure. Orders are canceled between cycles, and the article presents the exercise as a test environment deployment focused on observing execution behavior.

The EdgeX example uses three Bollinger Band widths. It opens short positions when price exceeds upper bands and long positions below lower bands, increasing order size with the band level; positions are closed when price returns through the middle band. Backtest and test deployment screenshots are mentioned, but no quantified performance, costs, or robust validation are provided. The examples are educational prototypes and the article cautions against treating them as ready for live trading.

Key ideas

• The WOOFi prototype adapts layered order spacing to ATR and prioritizes closing existing inventory.
• It refreshes market data and account state, then cancels orders between trading cycles.
• The EdgeX strategy opens against moves beyond multiple Bollinger Bands and scales size with band level.
• It exits positions when price returns across the middle band.
• The examples are instructional and provide no detailed evidence of live profitability.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.