Building a Trading Bot with Freqtrade

Freqtrade is a Python-based crypto trading bot. ```bash python -m venv freqtrade-venv source freqtrade-venv/bin/activate pip install freqtrade

Initialize a new bot configuration:

```bash
freqtrade create-userdir --userdir user_data
freqtrade new-config --config user_data/config.json

The wizard prompts for exchange, API keys (optional for backtesting), and trading pairs.

Strategies are Python classes defining buy/sell signals. ```bash freqtrade new-strategy --strategy MyFirstStrategy

```python
from freqtrade.strategy import IStrategy
from pandas import DataFrame
import talib.abstract as ta

class MyFirstStrategy(IStrategy):
    minimal_roi = {"60": 0.01, "30": 0.02, "0": 0.04}
    stoploss = -0.10
    timeframe = '5m'

    def populate_indicators(self, dataframe: DataFrame, metadata: dict) -> DataFrame:
        dataframe['rsi'] = ta.RSI(dataframe, timeperiod=14)
        return dataframe

    def populate_buy_trend(self, dataframe: DataFrame, metadata: dict) -> DataFrame:
        dataframe.loc[dataframe['rsi'] < 30, 'buy'] = 1
        return dataframe

    def populate_sell_trend(self, dataframe: DataFrame, metadata: dict) -> DataFrame:
        dataframe.loc[dataframe['rsi'] > 70, 'sell'] = 1
        return dataframe

First download historical data: ```bash freqtrade download-data --exchange binance --pairs BTC/USDT --days 120 --timeframe 5m

Run the backtest:

```bash
freqtrade backtesting --strategy MyFirstStrategy --timeframe 5m --timerange 20250101-20250601

Output includes total trades, win rate, average profit, max drawdown, Sharpe ratio, and profit factor.

Configure dry-run mode: ```json {"dry_run": true, "dry_run_wallet": 1000, "exchange": {"name": "binance", "pair_whitelist": ["BTC/USDT"]},"max_open_trades": 3, "stake_amount": 50}

Start the bot:

```bash
freqtrade trade --config user_data/config.json --strategy MyFirstStrategy

The bot simulates trades without placing real orders.