RCQ BTC Trading Strategy — Methodology & Guardrails

Purpose This page explains what we do and how we protect you without revealing proprietary code or signal recipes. It is intended for customers evaluating RCQ BTC Trading Strategy as SaaS/API, white‑label partners, and compliance reviewers.

1) Strategy Overview

• Objective: Systematic Bitcoin trading focused on extracting edge from volatility, regime shifts, and trend persistence while controlling drawdowns.
• Instruments: BTC spot, BTC ETFs, and select cash‑settled derivatives via user’s broker/exchange. (Execution is client‑side; RCQ provides signals & risk rails.)
• Time Horizons: Intraday to swing (hours → multi‑days) using multi‑timeframe confirmation.
• Core Edge (high‑level):
  • Regime model (risk‑on/off/neutral) driven by market structure and macro‑sensitive filters.
  • Trend engine (range vs. directional) with persistence/mean‑reversion classifiers.
  • Momentum stack using rate‑of‑change, breadth, and retest logic (no single indicator dominance).
  • Volatility lens for position gating, stop spacing, and take‑profit bands (ATR/EV‑scaled; no fixed pip targets).
  • Liquidity filter to avoid poor fills around scheduled events, illiquid hours, or exchange incidents.
• We never disclose exact thresholds, indicator parameters, or weightings. All examples herein are conceptual.

2) Signal Types

• ENTRY_LONG / ENTRY_SHORT: Directional entries gated by the regime/trend conjunction and liquidity checks.
• ADD / SCALE: Risk‑aware scale‑ins only when realized variance & slippage allow.
• PARTIAL_TAKE / FULL_EXIT: Profit‑taking bands adapt to volatility and tape context.
• RISK_OFF: Hard exit signal triggered by guardrails (max loss, structural breaks, exchange anomalies).

Each signal includes: timestamp (UTC), direction, suggested risk (bps of equity), soft stop/TP guidance, and validity window.

3) Risk & Guardrails (Non‑Negotiables)

Account‑level controls (client enforced; RCQ recommends defaults below):

• Per‑Order Notional Cap: e.g., ≤ 0.5–2.0% of account equity per order.
• Per‑Symbol Exposure Cap: e.g., ≤ 10–30% of account equity in aggregate BTC exposure.
• Daily Loss Halt: e.g., stop trading for the day at −1.0% to −2.0% equity.
• Total Drawdown Lock: e.g., pause strategy at −10% to −15% from equity peak; resume only after review.
• Max Concurrent Positions: e.g., 1–3 active legs to limit complexity and slippage.
• Slippage Budget: refuse fills worse than a configurable bps threshold.

Circuit Breakers:

• Exchange outages, abnormal spreads, or funding spikes.
• Data integrity failures (stale, gapped, or conflicting feeds).
• Macro event lockouts (user‑configurable calendars).

Trade‑level controls

• Stops: Soft (vol‑scaled) + hard (failsafe) with asymmetry favoring capital preservation.
• Profit Sequencing: Partial at band‑1, trail remainder using structure‑aware logic.
• No Averaging Down outside pre‑authorized scale plans with explicit risk caps.

4) Data, Models & Testing (What We Disclose)

• Data Sources: Institutional‑grade price/volume/derivatives reference data + redundancy. Client retains final choice of broker/exchange feed.
• Latency: Signals are computed server‑side; delivery via HTTPS/Webhook. Client execution is responsible for order placement and compliance.
• Model Governance:
  • Versioned releases (semver) with change logs.
  • Shadow/Canary rollouts; rollback on anomaly.
  • Feature flags for partner cohorts.
• Backtesting Standards:
  • Use realistic fees, slippage models, and data cleaning.
  • Walk‑forward and out‑of‑sample validation.
  • Survivorship‑bias and look‑ahead avoidance.
• Live Monitoring: Real‑time drift checks vs. expected signal behavior; alarm on divergence.

We publish methodology standards and controls, not the formulae. Partners may receive additional audit artifacts under NDA.

5) Execution Model

• Delivery: Signals → API/Webhooks/Email; you execute via your broker (or your OMS). Optional simulators provided for UAT.
• Order Types (recommended): Limit/market‑able limit with kill switches; IOC/PO as needed.
• Position Sizing: Expressed in basis points of equity or notional ceilings; client controls leverage.
• Broker Neutrality: We do not auto‑execute customer funds. BYO broker/exchange. Enterprise options available via separate agreement.

6) API (Public Spec — Stable)

Base URL: /v1/
GET /signals/latest?symbol=BTC-USD
GET /signals/history?symbol=BTC-USD&limit=500
POST /webhooks/subscribe
GET /risk/rails
POST /simulate/order
Rate limits: 60 req/min default; burst tokens available on enterprise plans.
Auth: OAuth2 client credentials + per‑request HMAC; IP allow‑lists supported.

7) Uptime, Incidents & Maintenance

SLO: 99.5% monthly signal API availability. Maintenance pre‑announced; post‑mortems within 72 hours.

8) Security & Privacy

TLS 1.2+, HSTS, HMAC webhooks; encryption at rest; least‑privilege; SOC2‑aligned roadmap.

9) Compliance, Disclosures & Ethics

No advice; no custody; performance is not indicative; client must comply with local rules; conflict policies apply.

10) Customer Onboarding & Support

Keys → rails → webhook → paper trade ≥2 weeks → go live with loss halts & DD locks. Support tiers: Email → Slack/Teams → TAM.

11) Governance & Change Management

Monthly minor releases; urgent patches as needed; 90‑day deprecation windows.

12) KPIs We Publish

API SLO, latency p50/p95, live slippage vs budget, guardrail breach counts, version adoption.

13) Roadmap (Non‑binding)

ETH streams, client‑hosted adapters, enhanced structure models, SOC2 Type II.

14) Legal Footer

RCQ provides research/signals/automation; no execution, custody, or investment advice. Trading involves risk.

Appendix A — Recommended Default Risk Rails (Template)

{
  "per_order_notional_cap_bps": 100,
  "per_symbol_exposure_cap_bps": 2000,
  "daily_loss_halt_bps": 150,
  "total_drawdown_lock_bps": 1200,
  "max_concurrent_positions": 2,
  "slippage_budget_bps": 10,
  "macro_lockout_calendar": ["FOMC","CPI"],
  "exchange_anomaly_triggers": { "spread_widening_bps": 25, "feed_staleness_seconds": 3 }
}

Appendix B — Signal Payload (Example)

{
  "symbol": "BTC-USD",
  "timestamp_utc": "2025-10-20T18:32:00Z",
  "type": "ENTRY_LONG",
  "confidence": 0.62,
  "risk_budget_bps": 75,
  "soft_stop": {{ "type": "vol_scaled", "distance_bps": 90 }},
  "tp_bands_bps": [80, 160, 260],
  "valid_for_seconds": 300,
  "notes": "Regime=Neutral→Risk-On; Trend=Range→Break; Liquidity OK"
}

Appendix C — Incident Communication Template

• What happened (summary)
• Impact window (UTC)
• Client action
• Next update (ETA)
• Post‑mortem link (≤ 72h)