Feature-Rich Long-term Bitcoin Trading Assistant

TL;DR

This paper presents a feature-rich reinforcement learning-based Bitcoin trading assistant that integrates technical indicators and sentiment analysis to achieve an average profit of 69% over 685 days, including volatile periods.

Contribution

It introduces a novel environment combining technical indicators and sentiment scores for long-term Bitcoin trading using reinforcement learning.

Findings

Achieved an average profit of 69% over 685 days.

Successfully incorporated sentiment analysis into trading decisions.

Provided a user-friendly website with visualizations and recommendations.

Abstract

For a long time predicting, studying and analyzing financial indices has been of major interest for the financial community. Recently, there has been a growing interest in the Deep-Learning community to make use of reinforcement learning which has surpassed many of the previous benchmarks in a lot of fields. Our method provides a feature rich environment for the reinforcement learning agent to work on. The aim is to provide long term profits to the user so, we took into consideration the most reliable technical indicators. We have also developed a custom indicator which would provide better insights of the Bitcoin market to the user. The Bitcoin market follows the emotions and sentiments of the traders, so another element of our trading environment is the overall daily Sentiment Score of the market on Twitter. The agent is tested for a period of 685 days which also included the volatile period of Covid-19. It has been capable of providing reliable recommendations which give an average profit of about 69%. Finally, the agent is also capable of suggesting the optimal actions to the user through a website. Users on the website can also access the visualizations of the indicators to help fortify their decisions.