Polymarket Weather Edge Paper-Trading

This bot identifies overpriced YES shares in Polymarket temperature prediction markets by comparing market prices against a Gaussian probability model built from live METAR weather station observations and Open-Meteo numerical forecasts. When the market price for a YES outcome exceeds the model's estimated probability, the bot places NO bets expecting the market to converge toward reality. The strategy uses Gaussian distributions fitted to historical weather data to calculate the likelihood of temperature ranges. Entry is triggered when the arbitrage spread exceeds a configurable threshold. Exits occur at market resolution or when spreads narrow. As a paper-trading bot, it simulates trades without real capital risk. The approach is limited to temperature markets with reliable weather station data. Risks include model misspecification during extreme weather events, sudden forecast revisions, and low liquidity in niche weather markets.