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# Signal Generation

## Overview

The signal generation module produces actionable trading plans delivered to consumers daily. Signals are constrained by strict risk management rules.

## Constraints

| Rule | Value | Rationale |
|---|---|---|
| Max signals per day | **3** | Quality over quantity |
| Max hold time | **30 minutes** | Scalping/day-trade focus |
| Execution | **Manual** | Human confirms and executes |
| Min confluence score | **0.65** | High-probability setups only |

## Signal Structure

Each signal contains:

```typescript
interface TradingSignal {
  // Identification
  id: string;
  timestamp: string;
  pair: string;
  
  // Direction
  direction: 'BUY' | 'SELL';
  
  // Levels
  entry_price: number;
  stop_loss: number;
  take_profit: number;
  
  // Meta
  confidence: number;        // 0.0 - 1.0
  reasoning: string[];       // List of confirming factors
  time_window: string;       // Optimal entry window
  max_hold_minutes: number;  // Always ≤ 30
  
  // Risk
  risk_reward_ratio: number; // Minimum 1:1.5
  position_size_pct: number; // % of capital suggested
}
```

## Daily Plan Format

Delivered each trading day before market open:

```markdown
## 📊 Daily Trading Plan — 2026-07-16

### Market Bias
- EUR/USD: Bullish (1H EMA trend up)
- GBP/USD: Neutral (ranging)

### Signals (Max 3)

#### Signal 1: EUR/USD BUY
- **Entry**: 1.0892 (on pullback to VWAP)
- **Stop Loss**: 1.0875 (-17 pips)
- **Take Profit**: 1.0920 (+28 pips)
- **R:R**: 1:1.65
- **Window**: 09:00-09:30 UTC
- **Confidence**: 82%
- **Reasoning**: 
  - Bullish engulfing on 5m
  - RSI bouncing from 35
  - VWAP support holding
  - London session momentum

#### Signal 2: ...

### Key Levels to Watch
- EUR/USD: Support 1.0870, Resistance 1.0935
- GBP/USD: Support 1.2640, Resistance 1.2710

### Risk Notes
- ⚠️ NFP data release at 13:30 UTC — avoid new positions 30min before
- Volume expected to increase London/NY overlap (13:00-16:00 UTC)
```

## Delivery Channels

| Channel | Method | Timing |
|---|---|---|
| Discord | Webhook/Bot message | Pre-market (06:00 UTC) |
| API | REST endpoint | On-demand |
| Email | SMTP notification | Optional digest |

## Signal Validation Rules

Before a signal is emitted, it must pass:

1. **Confluence check** — Score ≥ 0.65
2. **Risk/Reward check** — R:R ≥ 1:1.5
3. **Time filter** — Within active session hours
4. **Correlation filter** — No conflicting signals on correlated pairs
5. **News filter** — No high-impact events within hold window
6. **Daily limit** — Max 3 signals not exceeded
7. **Spread check** — Current spread within acceptable range

## Performance Tracking

Track all signals for continuous improvement:

```sql
CREATE TABLE signal_performance (
    signal_id TEXT PRIMARY KEY,
    pair TEXT,
    direction TEXT,
    entry_price REAL,
    exit_price REAL,
    pnl_pips REAL,
    hold_time_minutes INTEGER,
    outcome TEXT,  -- 'TP_HIT', 'SL_HIT', 'TIME_EXIT', 'MANUAL_EXIT'
    created_at DATETIME
);
```

**Target Metrics:**
- Win rate: > 55%
- Average R:R achieved: > 1.3
- Max consecutive losses: < 5
- Monthly Sharpe: > 1.5