Macro Agent

Status: Verified against code Last Updated: 2025-12-11

Role in Plain English

The Macro Agent is your big picture analyst. It steps back from the chart to answer:

"What's happening in the broader market, and does it support or challenge this trade?"

What It Analyzes

1. Market Regime Identification

The agent classifies the current market environment:

Regime	What It Means	Impact on Trades
Risk-On	Stocks up, VIX down, risk assets rising	Favors LONG positions
Risk-Off	Stocks down, VIX up, flight to safety	Favors SHORT positions or caution
Neutral	Mixed signals, no clear direction	No strong bias either way
Transitioning	Conditions are changing	Higher uncertainty

2. Cross-Asset Analysis

The agent compares your ticker to major indices:

Index	What It Tells Us
SPY	Broad market direction (S&P 500)
QQQ	Tech sector strength (NASDAQ-100)
VIX	Fear gauge (high = uncertainty)
DXY	Dollar Index (currency strength impact, if available)

Cross-Asset Alignment:

• Aligned: Your ticker moving WITH the market
• Divergent: Your ticker moving AGAINST the market
• Mixed: Some alignment, some divergence

3. Intermarket Divergence

The agent assesses whether the ticker is leading or lagging the broader market:

Status	What It Means
Leading	Ticker moves before market (potential early signal)
Lagging	Ticker moves after market (catching up)
In Sync	Ticker moves with market in real-time
Decoupled	Ticker ignores market direction (idiosyncratic)

4. Economic Assessment

Factor	What We Check
Inflation Trend	Rising / Falling / Stable (based on CPI/PCE)
Fed Stance	Hawkish / Dovish / Neutral (implied from data)
Yield Curve	Normal / Inverted / Flat (2Y vs 10Y)

Impact:

• Rising inflation + Hawkish Fed = Pressure on growth stocks
• Inverted yield curve = Recession signal = Risk-off bias

Economic Data Temporal Context

The Macro Agent applies temporal weighting to economic data:

Data Age	Weight
Fresh (last few days)	HIGH weight, reliable
Recent (1-2 weeks)	MEDIUM weight
Stale (2+ weeks)	LOW weight, may be outdated

Practical rule: If a key datapoint is stale, the Macro Agent flags it and reduces how much it influences the verdict.

5. News Sentiment (Temporal Weighting)

The agent reviews recent news and classifies overall sentiment with time-based weighting:

News Age	Weight	Label
<15 minutes	HIGHEST (breaking catalyst)	[BREAKING - JUST NOW]
<60 minutes	HIGH (current context)	[X min ago]
1-24 hours	MEDIUM (developing story)	[Xh ago]
>24 hours	LOW (background context)	[OLD]

Practical rule: Breaking items (minutes old) matter most; older stories become background context unless they’re still actively moving price.

Sentiment Categories:

Sentiment	Meaning
Bullish	News flow is positive
Bearish	News flow is negative
Neutral	Balanced or no significant news
Mixed	Conflicting news signals

6. Global Events & Wild Cards

The Macro Agent is aware of events that can override technical analysis:

Event Type	Examples
Fed comments	Powell speech = instant market reaction
Social media	Elon/Trump tweets can move specific stocks or crypto
Geopolitical	War, trade disputes
Liquidity events	Japanese yen carry trade unwinding
Currency crises	Can cause market-wide impact

7. International Markets

Market	What It Tells Us
Asia (Nikkei, Hang Seng)	Overnight sentiment
Europe (DAX, FTSE)	Current global risk appetite

How We Use It:

• Asia strong + Europe strong = Bullish gap potential at US open
• Asia weak + Europe weak = Bearish gap potential
• Mixed = Uncertain opening, watch first 15 minutes

Note: International data weight decreases as the US session progresses.

8. Session Context

Session	Characteristics
Pre-market	Overnight news, gap risk
Regular hours	Normal trading conditions
After-hours	Thin liquidity, news-driven moves

Direction Mapping

The Macro Agent's output maps to trading direction:

Macro Output	Trading Direction
risk_on	BULLISH (same as LONG)
risk_off	BEARISH (same as SHORT)
neutral	NO STRONG OPINION (doesn't block trades)

Key Point: Macro "neutral" does NOT block trades. It just means the macro environment isn't providing strong directional bias.

What It Outputs

The Macro Agent returns a JSON verdict with these fields:

Field	Values	Description
market_regime	risk_on / risk_off / neutral / transitioning	Overall market environment
confidence	0-100	Minimum 40% if ANY data exists
spy_direction	up / down / flat	S&P 500 direction
qqq_direction	up / down / flat	NASDAQ-100 direction
cross_asset_alignment	aligned / divergent / mixed	Ticker vs market
intermarket_divergence	leading / lagging / in_sync / decoupled	Ticker behavior vs market
session_context	object	Session type and risk note
economic_assessment	object	Inflation, Fed stance, yield curve
news_sentiment	object	Overall sentiment + key themes
international_assessment	object	Asia/Europe sentiment and gap bias
reasoning	array	Specific observations with evidence

Economic Assessment Object

"economic_assessment": {
  "inflation_trend": "rising" | "falling" | "stable" | "unknown",
  "fed_stance_implied": "hawkish" | "dovish" | "neutral" | "unknown",
  "yield_curve_signal": "normal" | "inverted" | "flat" | "unknown",
  "macro_headwinds": ["list of economic concerns"],
  "macro_tailwinds": ["list of economic supports"]
}

International Assessment Object

"international_assessment": {
  "asia_sentiment": "bullish" | "bearish" | "neutral" | "unavailable",
  "europe_sentiment": "bullish" | "bearish" | "neutral" | "unavailable",
  "gap_bias": "gap_up" | "gap_down" | "flat" | "uncertain",
  "relevance": "high" | "medium" | "low" | "none"
}

News Sentiment Object

"news_sentiment": {
  "overall": "bullish" | "bearish" | "neutral" | "mixed",
  "key_themes": ["theme 1", "theme 2"],
  "major_concerns": ["concern 1", "concern 2"]
}

Minimum Confidence Rule

• If you have SOME data, provide at least 40% confidence
• Only use 0% confidence if you have NO data at all
• Partial data = partial confidence

How Its Opinion Gets Used

The Macro Agent's verdict goes to the Supervisor Agent along with Technical and Wild Card verdicts.

Key rule: If Technical and Macro disagree, Technical wins because it has actual price data. Macro provides context, but price is truth.

Implementation details are intentionally omitted from public documentation.