BitDoctor Risk Appetite Dashboard

BitDoctor Risk Appetite Dashboard

The BitDoctor Risk Appetite Dashboard is a powerful tool for gauging market sentiment and risk appetite across major asset classes. It combines equity, credit, emerging markets, interest rates, and crypto signals into a single dashboard, giving traders a clear view of current market dynamics.

What it does:
- Calculates momentum for each key asset using a 14-day rate of change.
- Normalizes each signal and plots a composite Risk Appetite Strength Index (RASI) on the chart.
- Displays a dashboard table showing the momentum of each component in percentage terms alongside the composite RASI.

How to use it:
The plotted RASI line shows overall risk appetite:
- Positive readings suggest a stronger risk-on environment.
- Negative readings indicate risk-off sentiment.

The dashboard table (top-right corner by default) displays two columns:
- Asset: The tracked asset symbol.
- Momentum: The current 14-day rate of change as a percentage.

Interpreting the table:
Each row represents a component of market risk sentiment:
- SPY: US equities.
- HYG: High yield bonds (credit risk appetite).
- EEM: Emerging markets.
- 1/UST10Y: Inverted 10-year Treasury yield (lower yields support risk appetite).
- ETH: Ethereum (crypto risk proxy).
- RASI: The average of the above signals, indicating overall market risk appetite.

Higher positive values in the table suggest rising momentum in that asset, which contributes positively to the composite RASI. Conversely, negative values signal declining momentum. You can use these individual readings to see which sectors are driving the current risk sentiment and to time entries and exits accordingly.

Customization:
The indicator allows you to adjust the table's background color, text color, text size, cell padding, and position so it remains readable and unobtrusive regardless of your chart theme.

Use the BitDoctor Risk Appetite Dashboard as part of a broader analysis to align your trades with prevailing risk conditions. It is not a standalone trading signal but a context tool to support better decision-making.


Why these assets were chosen:
The dashboard uses a carefully selected mix of widely-followed proxies for global risk sentiment:
- SPY: Represents large-cap US equity market performance, a key barometer of investor confidence.
- HYG: Tracks high-yield corporate bonds, reflecting credit risk appetite in fixed income markets.
- EEM: Captures emerging market equities, which are highly sensitive to global risk-on/off dynamics.
- 1/UST10Y: The inverse of the US 10-year Treasury yield, as falling yields often accompany risk-on moves and vice versa.
- ETH: Ethereum as a representative crypto asset, offering insight into speculative risk appetite in digital assets.

This mix provides a comprehensive view of sentiment across traditional and alternative markets, making the dashboard a robust tool for gauging overall risk appetite.