How It Works

The Remora Risk Engine is a comprehensive market analysis system that combines technical indicators, external data sources, and machine learning to provide real-time risk assessments for cryptocurrency trading.

Data Collection

The engine continuously fetches OHLCV (Open, High, Low, Close, Volume) data from multiple exchanges including Kraken and Binance. This data is collected in real-time and stored for historical analysis.

Technical Analysis

The system calculates 50+ technical indicators including:

Trend Indicators: ADX, Moving Averages (SMA, EMA), Trend Strength
Volatility Indicators: ATR, Bollinger Bands, Volatility Percentile
Momentum Indicators: RSI, MACD, Stochastic Oscillator
Volume Indicators: Volume Profile, On-Balance Volume (OBV)
Support/Resistance: Pivot Points, Fibonacci Levels

External Data Integration

The engine integrates multiple external data sources:

Fear & Greed Index: Market sentiment indicator (0-100 scale)
News Sentiment: Real-time analysis of cryptocurrency news sentiment
Funding Rates: Perpetual swap funding rates from major exchanges
Open Interest: Total open positions in futures markets
Liquidation Data: Recent liquidation events and volumes
BTC Dominance: Bitcoin market capitalization percentage
VIX & DXY: Traditional market volatility and dollar strength indicators

Risk Score Breakdown

The composite risk score (0-1) is calculated from multiple weighted factors. Lower scores indicate safer trading conditions, while higher scores suggest increased risk.

Component Weights

Volatility (35%): Current volatility vs historical norms
Regime (30%): Market regime classification risk
Trend Strength (20%): Strength and direction of current trend
Momentum (15%): Price momentum indicators
External Factors (15%): Fear & Greed, news sentiment, funding rates

Risk Score Interpretation

Lower scores (0-0.3): Low risk, favorable conditions
Medium scores (0.3-0.7): Moderate risk, use caution
High scores (0.7-1.0): High risk, consider avoiding trades

Market Regimes Explained

The Remora Risk Engine classifies market conditions into distinct regimes:

🐂 Bull Market

Strong uptrend with consistent higher highs and higher lows. Risk Level: Low to Moderate. Best for: Long positions, trend-following strategies.

🐻 Bear Market

Downtrend with lower highs and lower lows. High risk for long positions. Risk Level: High. Best for: Short positions, defensive strategies, or staying flat.

🌊 Choppy Market

Sideways/consolidation phase with no clear trend direction. Risk Level: Moderate to High. Best for: Range-bound strategies or avoiding trades.

⚡ Volatile Market

High volatility environment with large price swings. Risk Level: High. Best for: Volatility-based strategies with proper risk management.

Trade Blocking Rules

The system automatically blocks trades when:

Extreme Fear (F&G Index < 20)
High Volatility (> 90th percentile)
Bear Market with strong confirmation
Panic Conditions (multiple risk factors elevated)
Bearish News (strong negative sentiment)

API Integration Examples

Python Example (Freqtrade Strategy)

import requests
import os

def confirm_trade_entry(self, pair: str, **kwargs) -> bool:
    api_key = os.getenv("REMORA_API_KEY")
    headers = {"Authorization": f"Bearer {api_key}"} if api_key else {}
    
    try:
        response = requests.get(
            "https://remora-ai.com/api/v1/risk",
            params={"pair": pair},
            headers=headers,
            timeout=2.0
        )
        data = response.json()
        return data.get("safe_to_trade", True)
    except Exception:
        return True  # Fail-open

Simple Python Example

import requests

def should_enter_trade(pair):
    try:
        response = requests.get(
            "https://remora-ai.com/api/v1/risk",
            params={"pair": pair},
            timeout=2.0
        )
        return response.json().get("safe_to_trade", True)
    except Exception:
        return True  # Fail-open

Getting Started

Ready to integrate Remora into your trading system?

Get Your API Key View API Documentation