The crypto market is one of the most intense financial environments ever conceived by humanity. The market operates 24/7, has thousands of different assets, and does not follow many laws of fundamental analysis that we commonly apply when trying to understand why certain assets experience volatility or start gaining value.
Since traders have to be active around the clock to never miss out on valuable opportunities to make money, thousands of them prefer using crypto trading robots to make their trading endeavors more efficient and reliable in the volatile crypto market.
Automation became an integral part of the whole crypto industry and allowed thousands of retail traders from across the globe to make profits during periods of volatility. Different automation solutions can be incredibly beneficial to certain types of retail traders. Depending on tolerated risks and capital size, you can choose a great automation product that will dramatically improve your gains in the crypto market.
Different types of auto trading robots
There are several main types of automation bots that are widely used by the crypto community. You have heard about several popular strategies that can be fully automated.
- DCA buying is a hugely popular technique among Bitcoin enthusiasts. They use distributed cost average approach to reduce the average price of assets in their portfolios. The method is quite simple. You make a purchase and wait for the price to change. If the price goes up, you don’t do anything. If the price goes down, you purchase again. Using this method allows you to increase your portfolio incrementally over a long period.
- DCA bots utilize the same approach, but they will put take profits above the entry point. You can choose various settings and use either the first entry point of the average price of purchased assets as the referential point for taking profit marks.
- GRID bots also use this approach of placing consecutive orders on a price trending down. However, it will also place a separate take-profit order for each entry point. Many placed orders from a grid on the price chart, hence the name.
- Copy trading solutions are often considered the best trading robots because traders can use them and follow some of the smartest traders. It is a good way for a novice trader to get comfortable in an industry famous for its stressful volatility and intense competition between retail traders.
Some companies also offer Arbitrage bots that compare prices between several crypto exchanges and seek minute discrepancies to make a profit. However, this method can be unreliable since the internet makes price convergence a very high risk. Nevertheless, due to the nature of the spot market, you can always find such discrepancies and capitalize on them.
For many people, crypto trading with robots is the best way of using their capital in this still developing industry where rules are vague and the landscape is full of surprises. Since the market is full of new of relatively new products like perpetual futures and crypto options, it is also important to use automation for derivatives that can be extremely volatile. Using futures trading bots in the crypto industry is a sound strategy if you want to trade derivatives.
Where do you buy bots for trading crypto?
The continuously increasing complexity of the crypto market facilitated high demand for automation solutions. The supply followed immediately. Today, we have hundreds of different platforms offering different automation products to their clients. However, it is important to choose only those companies that deserve your attention and can deliver a good user experience.
One of the best companies out there is WunderTrading. It is an advanced automation vendor that has a large arsenal of interesting solutions as well as custom scripts that you can create using an intuitive dashboard. WunderTrading is integrated with several external services and a wide array of CEX platforms including Binance, CoinBase, KuCoin, ByBit, and many more.
WunderTrading bots are used by all sorts of investors. Whether you are interested in DCA buying, GRID strategies, copying well-performing traders, or arbitrage, you will find a good solution in the catalog of this company. It offers some of the best trading robots that you can back-test using TradingView or run for free with the basic plan that allows users to create up to 5 bots.
Why should you use cryptocurrency trading robots?
While many people admire the around-the-clock nature of the crypto market, it is also detrimental to many traders who cannot perform consistently or miss out on valuable opportunities when sleeping or spending quality time with friends and relatives. It is only one reason to get a machine to trade on your behalf.
Here are some more reasons:
- Bitcoin trading robots never make mistakes under pressure. Many people hesitate or doubt their decisions and often miss perfect entry points. Emotionality is a big factor contributing to lackluster performances from retail traders. Inexperienced investors often lack confidence and decisiveness when trading. A machine does not experience emotions.
- Bots do not need to sleep or rest. A script works around the clock meaning that it will search for opportunities to make money even when other traders are calmly sleeping. A machine will perform its duties without pausing.
- Contemporary automation services are cheap. Just a couple of decades ago, only millionaires and large fund managers could afford to implement computation in their trading strategies. Modern cloud computing allows thousands of small-time traders to leverage the power of AI trading robots without spending a fortune.
For example, WunderTrading and 3Commas have free plans. While their free accounts are not as versatile and powerful, you can still use some automation without spending a dime. It is also a great method of testing whether these strategies work for you.
The main takeaway
Contemporary trading bots work perfectly because companies that provide automation services can run everything in the cloud and scale indefinitely allowing thousands of retail traders to effortlessly enter the market and start utilizing the power of automation in their trading strategies. If you understand technical analysis, you can easily build a custom solution without any technical know-how.
We live in an age of progress and convenience. You will have the power that was not even dreamt about by people engaging with financial markets two decades ago.