Owning a trading bot is one thing, understanding how it can bring about profits is another. Irrespective of why you have a bot, the fact that “no one opts for losses” is CERTAIN. New to automated trading? Don’t be discouraged because after reading this, a great head start is guaranteed! The core of this piece is based on indicators and decisions made based on them.
What is an Algorithm?
Do you think it is possible to program a bot to automatically recognize settings and carry out trades based on those settings? If YES, you are on the right track. However, if you think it is impossible, I’m sure you said that because you’re yet to understand how the process work and I am here to shed light into that. Coming from me, it is 100% possible with the interference of human interference meant to make the learning experience MUTUAL!
Different form of Trading Algorithm
- High-Frequency Trading (HFT)
- Transaction cost reduction
As the name implies, it involves the completion of a large volume of transactions at a high speed. This automated system can make trade decision in microseconds, and are compensated for it. HFT remains one of the great fit achieved in the crypto trading world.
Involves the purchase and sale of an asset in two different markets, whose price does not conform. A good example is that of a trader who discovers BTC USD to be equivalent to 7321.24 on Kraken and 7346.01 on Bitfinex, if he or she decides to buy Kraken and sell on Bitfinex, he or she is guaranteed to make a profit of 24.77 per trade. This form of the algorithm is risk-free but prone to inconsistency.
The act of making your trade “short-termed” in order to make small profits is called scalping. All you have to do when scalping is watch and observe the price flow of cryptocurrencies. You have to be very quick in making decisions with this method and how many quick decisions can you make in second? One or None, I am sure. Thus, bots are the only option for scalping.
Transaction Cost Reduction (TSR)
Transaction cost reduction is less exciting, no doubt, but remains a necessary technique. It involves the breaking down of large orders for easy accessibility or better performance in the open market.
How to make profits
The use of bot brings about profit in diverse ways. I believe anything that saves you extraneous trouble is profitable. Very quickly, let’s go!
- Bots help in the generation of profit by scaling your operation cheaply or for free. Imagine a scenario where you need to employ a second hand each time to attempt trading, the burden you have to endure and the likes make crypto bots profitable.
- Another avenue to this is via expansion to forex. This is, however, a big step and trust me, you will be needing all the help you can get. Nevertheless, with a good trading bot on your side, you’re good to go!
- Once you are familiar with your winning crypto strategy, you just stick to it and keep making profits until it proves otherwise. I term this “series repetition”
I know there are downsides to automated trading but the good tidings it brings exceeds its downside. If you don’t have much time for being blued to the screen monitoring the crypto markets, maybe a crypto trading bot will help you to automate your trading and safe your time. Below you will find the website of Gunbot, one of the most popular crypto trading bots.
For any types of queries, you can contact us on info[at]namasteui.com.