Filter Builder in SharpTrader: A Step Toward the Next-Generation AI Assistant Saturday September 27th, 2025 – Posted in: Arbitrage Software

From modular filters to full strategies—how we structure indicator logic for an AI-driven workflow.

Introduction

Today, trading is entering a new wave of development: artificial intelligence is no longer just helping with routine tasks—it is becoming a full participant in the process. In our SharpTrader platform, we are preparing to launch an AI assistant that will work based on trader prompts.

Its goal is to simplify the process of creating and testing trading ideas significantly. At the first stage, the assistant will learn to develop filters—modules that determine when a strategy is allowed to operate and when it is better to stay out of the market. Later, the capabilities will expand: we plan for the assistant to generate complete trading strategies, from idea to implementation.

Why focus on filters first? Filters are the foundation of any system. Even the strongest entry point can result in losses if used without considering market context. Filters help align a strategy with the market phase, trend strength, volatility level, and other factors. They turn a raw flow of signals into logical and sustainable trading.

In this article, we will: examine the classification of filters by groups, describe which indicators can be used, show examples of universal rules, and explain how to assemble a modular “filter builder.” Finally, we’ll invite you to share your feedback on prioritizing this AI assistant.

1. Indicator Groups & Filter Logic

Group A — Price ↔ Indicator Cross

Meaning: When price crosses a reference line, we determine in which direction to allow trading. If price is above—buys are allowed; if below—sells.

Tools: Moving Averages; midline of a channel/range; clouds or key trend lines; Parabolic SAR (flip points).

Rules: Price crosses line upward → AllowBuyOnly for N bars. Price above channel midline → AllowBuyOnly; below → AllowSellOnly. SAR flips from below to above → AllowSellOnly.

Group B — Indicator ↔ Signal Cross

Meaning: The main indicator line crosses its signal/aux line.

Tools: MACD-like indicators; Stochastic (%K vs %D); market strength indices with two lines; Alligator crossings.

Rules: Main above signal → AllowBuyOnly. Main below signal → AllowSellOnly. %K crosses %D up in oversold → reinforced AllowBuyOnly.

Group C — Oscillator Levels/Zones

Meaning: Oscillators identify overbought/oversold zones.

Tools: RSI, Stochastic, CCI, DeMarker, Williams %R, Momentum (100), histograms with zero line.

Rules: RSI < 30 → AllowBuyOnly. RSI > 70 → AllowSellOnly. CCI > +100 → AllowBuyOnly. Momentum > 100 → AllowBuyOnly.

Group D — Trend & Strength

Meaning: Filter trades by trend direction/strength.

Tools: ADX with +DI/−DI; MA slope; price vs cloud/zone.

Rules: ADX > 20 and +DI > −DI → buys only. ADX > 20 and −DI > +DI → sells only. Long-term slope positive and price above it → buys only.

Group E — Volatility Regime

Meaning: The strategy works only with sufficient volatility.

Tools: ATR, Standard Deviation, channel width.

Rules: ATR(14) above threshold → EnableTrading; below → DisableTrading. Rising StdDev for several bars → breakout mode.

Group F — Band/Channel Position

Meaning: Filter by price location within a range.

Tools: Channel bands; high/low ranges; Donchian channel.

Rules: Upper third → AllowSellOnly. Lower third → AllowBuyOnly. Upper boundary breakout (with retest) → AllowBuyOnly.

Group G — Structure/Breakout

Meaning: Filter by level breakouts and market structure.

Tools: Fractals; high/low ranges; zero-line histogram breaks.

Rules: Break of last local High → AllowBuyOnly. Break of local Low → AllowSellOnly.

Group H — Volume/Participation

Meaning: Trades are allowed if volume confirms the move.

Tools: OBV; Accumulation/Distribution; MFI.

Rules: OBV makes a new high → AllowBuyOnly. New low → AllowSellOnly. MFI > 80 → sells only; MFI < 20 → buys only.

Group I — Bill Williams Composite

Meaning: Use the Bill Williams toolkit.

Tools: Alligator; Fractals; AO/AC.

Rules: Alligator “opens” → trend filter active. AO > 0 and rising → AllowBuyOnly.

2. Indicator → Group Mapping

Group A – Price ↔ Indicator Cross
Group B – Indicator ↔ Signal Cross
Group C – Oscillator Levels/Zones
Group D – Trend & Strength
Group E – Volatility Regime
Group F – Band/Channel Position
Group G – Structure/Breakout
Group H – Volume/Participation
Group I – Bill Williams Composite
Indicator Primary Group Alternatives
Moving Average A, D F (relative to long-term line)
Channel Bands A, F E (width)
Cloud Indicators A, D F (position within cloud)
Parabolic SAR A D (trend confirmation)
Indicator w/ signal B C (zero line)
Stochastic B, C
RSI C
CCI C
DeMarker C
Williams %R C
Momentum C
Market Strength Index B
ADX D
StdDev E
ATR E
Fractals G
Alligator B, I D
AO C, I G
AC C, I
OBV H
Accum/Distrib H
MFI H C
BW MFI I E/H

Row color reflects the primary group of the indicator.

3. Universal Filters

Each filter returns one of the modes: AllowBuyOnly, AllowSellOnly, Disable (or Both, if unrestricted).

Main parameters: Lookback/ConfirmBars (hold for N bars); Thresholds (e.g., RSI 30/70); DirectionSource (main trend filter); VolatilityGate (enable/disable by volatility); TimeInForce (signal lifetime).

  • A: PriceCross(line, dir=Up, confirm=2)AllowBuyOnly.
  • B: CrossOver(main, signal, dir=Up)AllowBuyOnly.
  • C: Zone(RSI, buy<30, sell>70) → zone filter.
  • D: Trend(ADX>20 & +DI>−DI) → buys only.
  • E: Volatility(ATR>threshold) → else Disable.
  • F: BandPosition(upper tercile → SellOnly, lower → BuyOnly).
  • G: Breakout(level=High)AllowBuyOnly.
  • H: VolumeSlope(OBV rising) → confirm buys.
  • I: WilliamsPack(Alligator+AO)AllowBuyOnly.

4. How to Assemble a Filter Builder

The architecture combines:

  • Direction source (Group D)
  • Trigger permission (Groups A/B/C/F/G/I)
  • Volatility gate (Group E)
  • Volume confirmation (Group H)
  • Signal lifecycle (ConfirmBars/TimeInForce)

Conclusion & Feedback

We reviewed how to systematize indicators and convert them into universal filters for a builder. This is the first step toward the SharpTrader AI assistant. At launch, it will help create filters and, over time, complete trading strategies.

We’d love your input: How interesting is the AI assistant for SharpTrader? Which filters or functions should come first? Should we invest developer resources in this project?

Your comments and suggestions will help us set priorities and gauge demand within the trading community.

FAQ — Filter Builder in SharpTrader

Is this the same as arbitrage?
No. Arbitrage tries to capture price discrepancies between venues/brokers. The Filter Builder organizes technical indicators into logical rules that decide when a single strategy should be enabled or paused.
Do I need to code in C# to use it?
No. It’s designed for non-coders: you’ll choose indicators, thresholds, and conditions in a no-code UI. Advanced users can still export clean C# for review or customization.
What’s the rollout timeline?
AI-assisted filter coding and the no-code builder are being rolled out within the next two weeks. Next, we aim to let the AI assemble complete strategies from prompts.
Which indicators and filter types are supported?
Price↔indicator crosses (MA, cloud midlines, SAR), indicator↔signal crosses (MACD/Stoch), oscillator zones (RSI/CCI/DeMarker/W%R/Momentum), trend & strength (ADX/MA slope), volatility (ATR/StdDev), band/position (channels/Donchian), structure/breakouts (fractals/high-low), volume (OBV/A&D/MFI), and Bill Williams set (Alligator/AO/AC).
Can I combine filters with my existing strategies?
Yes. Filters can act as pre-conditions (enable/disable trading) or route signals into “buy-only / sell-only / off” modes for your current strategies.
How do I get access? Any cost?
All clients who have the Coding Module get 1 month of free AI filter coding. After that, we may add a small fee to help cover OpenAI/infrastructure costs.
Does it work on all brokers and markets?
The builder is part of SharpTrader. Broker coverage depends on your existing SharpTrader connectivity; indicator logic is broker-agnostic.
How does the AI handle privacy and my ideas?
Your prompts and generated code are processed under our platform’s security controls. We don’t share your custom logic; project data is kept within your account according to our data policy.
Where should I leave feedback or feature requests?
Please comment under the article or contact support. Real use-cases help us prioritize the next templates and the move to full AI strategy coding.