Trading cryptocurrencies is a trend that is apparently here to stay thanks to low barriers to entry for cryptocurrency investment. This asset class has proved to be a promising investment instrument that attracts more and more people, regardless of their level of income or background. Not all of them, however, have the opportunity to monitor charts to make the most out of their investments.
As a result of this vast expansion, lots of crypto enthusiasts and investors have started pursuing the idea of benefiting from crypto trading, without being tied to trading terminals. The solution was found in utilizing automated bots by connecting multiple crypto exchanges to external trading terminals via API keys.
What Are Trading Bots?
The prices of digital assets are prone to change suddenly and without warning. This, along with round-the-clock trading, goes way beyond human limits in terms of day trading. The market knows countless examples when investors could not react to a sudden change in the market prices in order to earn more profit or secure their investments in case of a significant price drop.
Here, using bots is very similar to employing professionals to trade on your behalf and garner profits for you. These factors make automated crypto trading with bots a necessity for traders, as bots, unlike humans, are always vigilant, precise, and fast.
Trading bots are extremely efficient when it comes to trading within a predefined range, but their possibilities go way beyond that. Thanks to built-in risk management and profit maximization tools, these AI-driven algorithms can benefit from a price surge through Trailing Up or close all existing positions in base currency in case of a sudden market dip.
Why Automated Trading Bots?
There are many reasons why crypto traders should opt for trading bots to redefine their trading system.
First and foremost, it is freedom from any emotions, especially fear and greed. This way, there is no human factor involved in the process of trading. The bots operate automatically, without questions or doubts.
Once the trading strategy is predefined and the bot is launched, it will gradually buy and sell crypto with tiny intervals earning a small amount of profit every hour, minute, or even every second.
The lack of emotions combined with the fact that it works with limited risks, trading bots discipline traders, helping them trade, according to a plan, without falling prey to FOMO.
Another way this system helps traders is by developing orders immediately when the set standards have been reached. They help enhance the trader’s entry speed. This could be hard for human traders, but because bots operate automatically, they are able to go in and out of a trade within seconds.
The crypto market is constantly moving and changing, and the change could be so sudden that human traders could miss it. These bots are set to automatically maximize such changes.
Bots use a system of “backtesting,” where they use the rules on trading to trade on a formal market statistic so they can know how variable the trading would be. To program these bots, all rules obtaining to trading are inputted into them, as they cannot take presumed trading on their own.
They follow these rules after testing them on previous similar data. This feature will enable the trader to have a broader picture of what to expect if they follow such rules.
Using a bot to trade allows you to work on various accounts at the same runtime. As a result, the trader would be able to diversify their trade and share their risk over other instruments. Doing this would be very difficult for human traders, while this is effectively carried out by the bots.
Recommended Trading Bots
One of the well-known and widely recommended trading bots is Bitsgap. This trading tool allows users to have several exchange accounts and transactions in one place. It provides various services to traders, among which are trading bots.
These bots are powered by the GRID algorithm. This algorithm allows traders to set their span and boundaries for trading and works to share these investments in perfect proportions.
In its operation, where the price does surpass the set value placed by the trader, the bot continues to take a trade. It also has a very efficient backtesting feature that allows how various bots would work and how much they would earn based on historical market data.
The backtesting feature allows avoiding launching unviable configurations and when combined with a set of built-in analytical tools, choosing the most profitable ones based on the current market conditions.
Crypto investors can use Bitsgap crypto bots to make orders on their behalf. The system is cloud-based and so there is no need for a download. There are various strategies made available for traders, including Classic bots for an uptrend, Sbot for sideways trading, and Combo bot for margin trading which is capable of benefiting from both rising and falling markets.