ANLY482 AY2017-18T2 Group06 Analysis Finding Finals
DATA PREPARATION
We configured a total of 4 functions to access our client’s brokerage platform, OANDA. These functions can retrieve/send data directly from the brokerage on demand through a live connection. Considerations put into deciding on these functions include:
• Retrieval of historical data from a chosen time period, with the latest possible date being ‘now’.
• Ability to choose the granularity of the data retrieved, ranging from minutes, daily to weekly.
• The specific financial instrument, currency pair, which we want to retrieve data on.
• Submission and modification of orders to the brokerage upon decision at the coding end for a buy/sell trading action.
The resulting functions to achieve all of the following considerations are below:
1. ActualPriceV20: Returns the current bid/ask price of the chosen currency pair
2. AccountInfoV20: Returns account information (balance, profit & loss)
3. AccountPositionsV20: Returns all open trade positions in chosen trading account
4. HisPricesV20: Returns the currency pair’s information according to parameters
TECHNICAL ANALYSIS: BOLLINGER BANDS & RSI
For the currency pair of USD/JPY, we will be using BBs & RSI to predict currency price movements and deliver a trading action based on their analysis.
The BBs consist of two lines, 2 standard deviation from the center line which is a 20-day simple moving average of the prices. The widening and contraction of the bands directly relates to the increase and decrease of volatility respectively as standard deviation is a measure of volatility. One of the pattern analysis seen by many traders, including our clients, on BBs is a pattern when prices moves significantly closer to the bands, indicating an overbought or oversold situation in the market. This would be a situation where traders might consider selling in an overbought situation and buying in an oversold market.
The Relative Strength Index (RSI) is a momentum indicator which compares the magnitude of the recent gain and loss over a specific period of time, to measure speed and change in price movements. The primary use of RSI is for identifying an overbought or oversold market.
