How does this bot work?
The Multi Pair Grid Bot scans the market for trading opportunities based on predefined conditions and trend behavior. It focuses on assets that have been declining for some time and starts trading when the downward move begins to lose momentum, which may indicate a potential reversal. When suitable assets are identified, the bot launches a grid bot to trade them. The grid bot places multiple buy and sell orders at different price levels to capture market fluctuations. The strategy can run up to 10 grid bots at the same time, allowing it to manage multiple trading opportunities and diversify exposure across several positions.
The Multi Pair Grid Bot uses preset strategy rules to determine the grid step percentage for each trading pair based on market conditions. Each strategy also includes a Trailing Profit feature designed to capture additional gains during sharp upward price moves, helping improve overall trading performance.
When is the best time to launch the bot?
As the bot operates only in the long direction, it is better to wait until the market has been in a downward trend for some time. When you see signs that the bearish move is losing strength, you can start the bot. To identify this exhaustion, you can use simple technical indicators on a higher time frame.
For example, you can use the daily time frame on Bitcoin and apply the RSI (Relative Strength Index) indicator. The black vertical line in the chart indicates an example of an entry point based on RSI(14) falling below the 30 level, which signals an oversold condition. In many such cases, after the initial drop, the market tends to move into a long-term sideways range. During this period, the Multi Pair Grid Bot can continuously capture small, incremental profits by trading the price fluctuations within that range. This approach may be more effective than a traditional Buy and Hold strategy, as it is designed to benefit from smaller market moves instead of waiting only for a large price increase.
You can also use alternative indicators to determine the exhaustion of bearish trends, such as the SuperTrend technical indicator. This type of indicator can be effective for identifying when bearish momentum is weakening. However, it still requires active monitoring and manual decisions on when to start and stop the bot. Used correctly, it can help improve timing and overall strategy performance.
For example: here is an illustration of the SuperTrend indicator applied to the Global 30 Crypto Index. In this example, the Average True Range (ATR) period is set to 100, and the ATR Multiplier is set to 1.7. This configuration helps smooth out price fluctuations and provides clearer signals for possible trend reversals. By analyzing these indicators carefully, you can make more informed decisions and improve trading performance.
When to stop the bot?
First, you can use opposite-side indicator signals to make exit decisions. For example, if you use the Relative Strength Index (RSI) as an entry condition, you can stop the Multi Pair Grid Bot when RSI reaches the opposite side of the range, such as moving above 70. This method, however, has a limitation. In a bullish market, RSI may enter overbought territory during the first upward move and then begin to fall even while the price continues to rise. As a result, you may exit too early and miss a larger profit opportunity.
If you decide to use the SuperTrend indicator in your trading strategy, this approach may provide a more accurate exit point and help maximize profits. It can also allow you to re-enter the market during a bull run, making it easier to participate in continuing upward trends. This creates a more flexible approach to managing entries and exits.
How will the equity curve look?
This is an example of a high-risk bot configuration on the platform. The bot traded over a period of 8 days, with its entry point based on the Relative Strength Index (RSI) and its exit point based on the SuperTrend indicator. After the initial entry, the market moved lower, resulting in an unrealized loss. However, after this decline, the market recovered and moved upward. As the recovery continued, the bot began collecting profits. The second screenshot shows the P&L curve from the Bybit exchange.
Eight days of trading results with the Multi Pair Grid Bot from WunderTrading:
What are the risks?
The Multi Pair Grid Bot trades only in the long direction. This grid trading strategy can perform well in sideways markets, where prices move within a range, and in bull markets, where prices trend upward. The main market condition where this strategy may struggle is a falling or bear market, where prices continue to decline — a limitation shared by many crypto trading bots.
Let’s look at the risks of keeping the bot running during a downward market move.
During a market decline, the bot may begin to accumulate unrealized losses as the value of purchased assets falls. The speed at which these losses build up depends largely on market volatility, meaning the frequency and size of price movements, as well as the risk level selected for the bot. Higher risk settings may lead to faster loss accumulation, while more conservative settings may reduce exposure but can also limit potential returns in favorable market conditions.
- Low Risk: Each trade uses about 5% of your investment
- Balanced Risk: Each trade uses about 10% of your investment
- High Risk: Each trade uses about 20% of your investment
Important! Not stopping the bot during a bear market can lead to complete account liquidation.
Top Tips
- Create multiple bots with low risk and different entry times. This will help diversify your portfolio.
- Make sure you have clear entry and exit points based on a trend indicator.
- Avoid high-risk settings when managing larger drawdowns.