June 12, 2024

Research: Data regarding the Complex Cognitive Reasoning

Model 1 Spot: Basic XAU/PAXGUSDT (KuCoin) –By the Deep
‍
Research Summary:

This research is details observations and analyses conducted by the FishAI team and presents detailed observations and analyses of the spot market behavior for XAU (Gold) and PAXG traded against USDT, focusing on the interaction between index performance and cryptocurrency spot prices over various dates in late 2023 and early 2024. The analysis was conducted on the KuCoin and Youholder platforms, using data visualizations derived from TradingView to monitor price movements in real-time.

Key Findings:

Market Behavior and Mirroring: The document notes instances of "delayed mirroring," where PAXG prices on spot markets react to changes in the XAU index after a short delay. These observations were meticulously recorded, showcasing the lag times and their impacts on trading strategies.
Model Development: Two primary trading models emerged from the analysis:
- Buy the Deep: This model focuses on purchasing during significant dips in the market, aiming to capitalize on the recovery. The effectiveness of this model depends on the timeliness and accuracy of market entry and exit points.
- Follow the Money: This model suggests following the trend with a focus on liquidity and volume indicators to gauge market sentiment.
Innovative Trading Strategies: A third model, "Copy Trade," is in the identification phase, leveraging automated bots for execution on the Youholder platform, emphasizing the need for rapid response strategies within a 5 to 25-minute reaction window.
Operational Insights: The analysis also highlights challenges, particularly with models performing poorly when market variations occur outside of standard trading hours. Conditions for successful trades include rapid response to market variations, ideally within 15-20 minutes, and price variations of 0.4% to 0.6% or more.

Conclusion:The document underscores the complexity and volatility of the spot trading environment and the necessity for advanced tools and strategies to navigate it effectively. These insights and models aim to enhance predictive capabilities and trading outcomes in highly fluid market conditions.

The spot model is based on visualizing and comparing the following tickers:
Index (candlestick): (GOLD(US$/OZ) commodity CFD TVC)
Crypto (in yellow): PAXGUSDT (spot crypto KuCoin)

Foreword:

‍Based on a study carried out on TradingView, the detailed observation covers a period of 1 month.
To have a good visibility of market reactions, the time span cannot exceed 5 minutes per candle. Being limited to a display of 5000 bars, it is not possible to see further in time in detail, which limits the possibilities of analysis.

Screenshot Visualization:‍

To have consistent visibility on the charts, only a price scale that includes the index and the pair is visible on the right.
‍

Identification of the Source Used:‍

To identify the source (GOLD(US$/OZ) commodity CFD TVC) that will serve as a reference, the comparison with the index [https://www.bullionbypost.fr/cours-de-lor/semaine/onces/USD/] is as follows:

Une image contenant capture d’écran, texte, Logiciel de graphismeDescription générée automatiquement

Even if the chart lacks visibility, it can be seen that the source and the index are relatively identical.

Une image contenant capture d’écran, Tracé, diagrammeDescription générée automatiquement

(GOLD(US$OZ spot commodity) candlesticks VS same model by line (in yellow) to have a generic vision.
The chart concerns the same source, but to have more visibility on other potential sources, which will be displayed in line, this last one shows how the linear schema behaves in comparison to the candlesticks. The schema is identical.
To be able to evaluate the exchange that would offer the best opportunities, the line graph is subject to comparison

‍Identification of the Most Appropriate Exchange:

‍After preliminary analyses, the 2 exchanges offering possibilities to create a model are as follows:
PAXG youholder
PAXG Kucoin

PAXG/USDT Youhodler: [https://app.youhodler.com/multihodl/instrument/paxg_usdt]

‍

Une image contenant capture d’écran, texte, TracéDescription générée automatiquement

The chart shows the behavior of PAXG on Youholder from 12h to 15h on 29.01.2023
‍
Each minute shows a price variation.
Lowest price: $2006; Highest price: $2016

This particular behavior may potentially give rise to a new model that had not been considered.

Comparison with the Index:

‍

Une image contenant capture d’écran, texte, Tracé, Logiciel de graphismeDescription générée automatiquement

Compared to the index, it appears that PAXG youhodler closely follows the variations of the index, however with a price difference of about $20

PAXG/USDT KuCoin: [https://www.kucoin.com/fr/trade/PAXG-USDT]

‍

Une image contenant capture d’écran, Logiciel de graphisme, Logiciel multimédiaDescription générée automatiquement

The chart shows the behavior of PAXG on KuCoin from 11h to 14h (UTC) on 29.01.2023The behavior of PAXG on KuCoin is very different from YouholderLowest price: $2004; Highest price: $2018

Une image contenant texte, capture d’écran, Logiciel de graphisme, Logiciel multimédiaDescription générée automatiquement

Compared to the index, it appears that PAXG youhodler has very little variation compared to the index. The relatively marked price difference compared to the index is also around $20.However, showing price variations while the market is stable, this allows for the creation of a "Buy the Deep" model.

Detailed Analysis Index VS PAXG KuCoin

‍

Une image contenant texte, capture d’écran, Tracé, diagrammeDescription générée automatiquement

Observations for December 26, 2023: Time Slot (UTC): 8:00 AM to 6:00 PM
1-2-4-5: For reasons still unknown, while the price of XAU does not undergo significant variations (about $3), the Spot market detaches from mirroring:

Spot loses about $7 in 30 minutes (from 2030.55 to 2023.12), a change of 0.36%, before regaining $9 in 10 minutes (from 2023.12 to 2032.73), a change of 0.47%.
Spot loses about $11 in 5 minutes (from 2036.39 to 2025.40), a change of 0.54%, before regaining $10 in 10 minutes (from 2024.40 to 2034.10), a change of 0.48%.
Spot loses about $14 in 10 minutes (from 2032.18 to 2018.62), a change of 0.66%, before regaining $9 in 5 minutes (from 2018.62 to 2027.41), a change of 0.43%.
Spot loses about $3 in 10 minutes (from 2027.41 to 2024.43), a change of 0.14%, before regaining $5 in 10 minutes (from 2024.43 to 2029.78), a change of 0.26%.

Identification of pairing: Given the abrupt and rapid drop of $16 in 10 minutes, it is possible to consider a single longer signal (which for this example would include events 4+5 as one signal). However, it would be necessary to assess the maximum tolerable value before closing the signal.

Illustration of "delayed mirroring" between the Index and Spot.
3. Index loses about $13 in 15 minutes (from 2067.47 to 2054.42), a change of 0.63% at 2:35 PM. The variation is mirrored in the Spot market 15 minutes later at 2:50 PM. Spot loses about $7 in 10 minutes (from 2030.14 to 2023.84), a change of 0.31%, before regaining $9 in 35 minutes (from 2023.84 to 2032.31), a change of 0.41%.

‍

Une image contenant texte, capture d’écran, TracéDescription générée automatiquement

Observations for December 27, 2023: Time Slot (UTC): 8:00 AM to 6:00 PM

While the price of XAU does not experience significant variations (about $2), the Spot market deviates from mirroring:

Spot loses about $7 in 15 minutes (from 2037.62 to 2030.50), a change of 0.35%, before regaining $9 in 10 minutes (from 2030.50 to 2039.99), a change of 0.46%.

‍

Observations for December 28, 2023: Time Slot (UTC): 8:00 AM to 6:00 PM

“Delayed Mirroring” between Index and Spot.

Starting at 1:35 PM, the Index loses about $7 in 25 minutes (from 2077.03 to 2070.75), a change of 0.30%. The variation is mirrored in the Spot market 15 minutes later at 1:50 PM. At Spot, at 1:50 PM, the variation is about $4 in 30 minutes (from 2049.80 to 2045.19), a change of 0.22%.
Starting at 2:05 PM, the Index gains about $5 in 15 minutes (from 2070.50 to 2075.10), a change of 0.22% at 2:20 PM. The variation is mirrored in the Spot market 15 minutes later at 2:20 PM. Spot gains about $6 in 5 minutes (from 2045.19 to 2051.77), a change of 0.32%.
Starting at 2:25 PM, the Index loses about $3 in 10 minutes (from 2074.24 to 2071.44), a change of 0.13%. The variation is mirrored in the Spot market 5 minutes later at 2:30 PM. At Spot, at 2:30 PM, the variation is about $4 in 10 minutes (from 2051.77 to 2047.55), a change of 0.20%.
Starting at 2:35 PM, the Index and Spot are in direct mirroring without any time delay. The Index gains about $8 in 25 minutes (from 2071.10 to 2079.08), a change of 0.22% at 3:00 PM. The variation is mirrored on Spot 15 minutes later at 2:20 PM. Spot gains about $6 in 5 minutes (from 2045.19 to 2051.77), a change of 0.32%.
At the time of writing, this case is difficult to anticipate, deviating from the patterns seen so far.

‍

Observations for January 2, 2024: Time Slot (UTC): 8:00 AM to 6:00 PM

Starting at 9:05 AM, the Spot loses about $5 in 25 minutes (from 2044.62 to 2039.60), a change of 0.24%, while the Index experiences very little variation. Starting at 9:30 AM, Spot gains about $7 in 25 minutes (from 2039.60 to 2046.18), a change of 0.32% as the Index begins to reverse. From 9:30 AM, the Index gains about $4 in 10 minutes (from 2074.40 to 2078.45), a change of 0.18%.
Starting at 9:55 AM, the Index loses about $5 in 20 minutes (from 2078.29 to 2073.20), a change of 0.24%. Delayed by 25 minutes, at 10:20 AM Spot loses $7 in 20 minutes (from 2045.32 to 2038.47), a change of 0.33% before gaining $8 in 25 minutes (from 2041.21 to 2046.91), a change of 0.28%.
Starting at 12:20 PM, while the Index undergoes very little variation, Spot gains $5 in 15 minutes (from 2040.34 to 2045.33), a change of 0.24%.
Starting at 2:20 PM, Spot loses about $7 in 15 minutes (from 2039.81 to 2032.58), a change of 0.35%, while the Index has not yet started to vary at the beginning of the drop. Then Spot regains about $6 in 10 minutes (from 2032.58 to 2038.66), a change of 0.30% while the Index starts to drop.
Starting at 3:10 PM, while the "Delayed Mirroring" of the Index's drop impacts Spot, which loses about $14 (from 2070.27 to 2055.85), a change of 0.72%, Spot counteracts this by rising and gaining about $10 in 5 minutes (from 2031.76 to 2041.11), a change of 0.46%.

‍

Une image contenant capture d’écran, texte, Tracé, diagrammeDescription générée automatiquement

Observations for January 3, 2024: Time Slot (UTC): 8:00 AM to 6:00 PM

While the Index does not show any exceptional variation, the Spot loses about $27 in 25 minutes (from 2029.72 to 2002.03), a change of 1.36% (the largest variation observed so far), and needs to recover in two stages to return to a traditional course. Spot regains about $12 in 15 minutes (from 2002.03 to 2014.95), a change of 0.64%, before losing about $6 in 10 minutes (from 2014.95 to 2008.39), a change of 0.32%. Then it regains about $15 in 25 minutes (from 2008.39 to 2023.82), a change of 0.76%. Adding the positive movements (0.64% + 0.76%), the total is a 1.40% gain for a 1.36% loss, even though the course is lower than its starting value.
“Delayed mirroring” occurs 15 minutes later. However, it is observed that Spot begins to rise 5 minutes before the Index reaches the high point of this variation during the LBMA fixing publication.
While the Index does not show any exceptional variation, at 4:45 PM Spot loses about $7 in 20 minutes (from 2007.26 to 2000.02), a change of 0.36%, before regaining $8 in 15 minutes (from 2000.02 to 2008.20), a change of 0.40%.

‍

After analyzing the price of USDT for the day of January 3, 2024, there is nothing to indicate the reason for such a significant variation.

‍

Une image contenant texte, capture d’écran, diagramme, TracéDescription générée automatiquement

Observations for January 4, 2024: Time Slot (UTC): 8:00 AM to 6:00 PM

1-2: At 9:40 AM, the Index loses about $2 in 20 minutes (from 2049.97 to 2047.92), a change of 0.10%, which is then mirrored in the Spot market with a "delayed mirroring" of +25 minutes. Spot loses about $2 in 20 minutes (from 2023.44 to 2021.64), a change of 0.8%, before regaining about $4 in 10 minutes (from 2021.64 to 2025.91), a change of 0.21%.

3-4: At 10:40 AM, the Index loses about $2 in 5 minutes (from 2048.91 to 2046.30), a change of 0.12%, which is then mirrored in the Spot market with a "delayed mirroring" of +20 minutes. Spot loses about $1 in 15 minutes (from 2025.82 to 2024.96), a change of 0.04%, before regaining about $4 in 10 minutes (from 2024.96 to 2028.31), a change of 0.16%.

5-6: At 2:25 PM, the Index loses about $5 in 20 minutes (from 2041.13 to 2036.10), a change of 0.24%, which is then mirrored in the Spot market with a "delayed mirroring" of +35 minutes. Spot at 3:00 PM loses about $2 in 20 minutes (from 2020.49 to 2018.22), a change of 0.11%, before regaining about $5 in 5 minutes (from 2018.22 to 2023.94), a change of 0.28%.

7: From 3:50 PM to 5:15 PM, Spot detaches from the Index and loses about $12 in 1 hour and 25 minutes (from 2023.29 to 2011.92), a change of 0.56% before regaining about $7 in 15 minutes (from 2011.92 to 2018.61), a change of 0.33%.

‍

January 5, 2024 Observations: Time Slot (UTC): 8:00 AM to 6:00 PM

January 8, 2024 Observations: Time Slot (UTC): 8:00 AM to 6:00 PM

‍

January 9, 2024 Observations: Time Slot (UTC): 8:00 AM to 6:00 PM

‍

Une image contenant texte, capture d’écran, Logiciel de graphisme, TracéDescription générée automatiquement

January 10, 2024 Observations: Time Slot (UTC): 8:00 AM to 6:00 PM

‍

January 11, 2024 Observations: Time Slot (UTC): 8:00 AM to 6:00 PM

January 12, 2024 Observations: Time Slot (UTC): 8:00 AM to 6:00 PM

‍

Une image contenant capture d’écran, diagramme, Tracé, texteDescription générée automatiquement

January 15, 2024 Observations: Time Slot (UTC): 8:00 AM to 6:00 PM

‍

January 16, 2024 Observations: Time Slot (UTC): 8:00 AM to 6:00 PM

‍

January 17, 2024 Observations: Time Slot (UTC): 8:00 AM to 6:00 PM
Journée particulière : Spot donne l’impression de mener le marché, très peu d’anticipation sont possibles. De plus, le délai de réaction est extrêmement court (5 min), voire en temps réel.

‍

January 18, 2024 Observations: Time Slot (UTC): 8:00 AM to 6:00 PM

January 19, 2024 Observations: Time Slot (UTC): 8:00 AM to 6:00 PM

January 22, 2024 Observations: Time Slot (UTC): 8:00 AM to 6:00 PM

January 23, 2024 Observations: Time Slot (UTC): 8:00 AM to 6:00 PM

January 24, 2024 Observations: Time Slot (UTC): 8:00 AM to 6:00 PM

January 25, 2024 Observations: Time Slot (UTC): 8:00 AM to 6:00 PM

January 26, 2024 Observations: Time Slot (UTC): 8:00 AM to 6:00 PM

Approche Simplifiée

Analyse à 1 minutes

January 29, 2024 Observations: Time Slot (UTC): 8:00 AM to 6:00 PM

January 29, 2024 Observations: Time Slot (UTC): 8:00 AM to 6:00 PM

‍

January 29, 2024 Observations: Time Slot (UTC): 8:00 AM to 6:00 PM

‍

January 29, 2024 Observations: Time Slot (UTC): 8:00 AM to 6:00 PM

January 29, 2024 Observations: Time Slot (UTC): 8:00 AM to 6:00 PM