The development of digital money is rapidly adopting technological achievements. This is reflected in innovative solutions used in exchange trading. Therefore, trading with the help of automated trading bots is gaining momentum today.
According to the latest data, 84% of transactions on global exchanges are made using high-frequency trading tools. In other words, the main players in the process are robots, which have taken over the main trading operations.
What are trading bots?
It is a computer program that can fully or partially replace a person in exchanges. It follows an algorithm that imitates the actions of a trader, is able to independently track necessary indicators, and, based on one or more conditions, make a decision on a trade.
Cryptocurrency exchange bots make routine work easier for the trader and even perform analysis. In addition, the programs do not succumb to emotions. It is much easier for them to follow a strategy than for traders. A person can make a mistake or fall into uncontrollable excitement, which will surely lead to losses in the end. With a robot, such a situation is impossible.
In addition, the best crypto trading bots has the following advantages:
- Speed.
- Strict adherence to the algorithm.
- Work without breaks and weekends.
These are the reasons why trading bots have gained such popularity.
Where can I get a trading bot?
There are three options for getting robots for trading digital assets:
If you are familiar with programming, you can create such a bot yourself. However, remember that a robot for cryptocurrency exchanges is written exclusively for a specific platform.
If you don't know how to program, consider buying a bot. Quite a few companies write such software, and the best trading bots for crypto can often be bought from them.
If the first two options do not suit you, you can download a trading bot for free. This has its advantages in that you don't have to invent anything, write programs or pay money. But the disadvantage is that the user cannot be sure that the bot will work exactly as stated in its description.
The main functions of bots
Risk management. This is one of the main purposes of trading bots, especially for beginners. All a trader needs to do is to set a range in which the bot can operate. It uses volatility statistics and profitability indicators and automatically performs risk management.
Buy and sell. You can instruct the bot, for example, to buy bitcoins 5% cheaper, and then place a sell order 10% more expensive, making a 15% profit. And if the price never reaches the desired bar, keep the same amount of dollars. Or effectively close the order if the BTC exchange rate unexpectedly goes in the other direction.
Multi-platform. Having connected to several exchanges, the bot can trade on them, keeping one common account. So it finds the best price offers, and it opens the possibility of arbitrage.
Logs and alerts. All actions are recorded in the database and can be displayed as a table or graph. Notifications come on applications, mail, or various messengers.
Market analysis. The bot can collect information from several sources on selected assets, save it in the database and display it in a convenient form.
Based on the above, trading bots are a useful tool for traders of all levels. Crypto trading bots for beginners can help them start trading and avoid serious mistakes on the path. Private investors can more easily diversify their portfolios and see the right signals to maximize profits. Professionals get all the tools for effective work on the market and technical analysis at a fairly affordable price.