Consistency is to the trader what air is to the average person. Every successful investor needs a strategy consisting of repeatable decisions having repeatable results. A good way for investors to find consistency is through trading bots. Algorithms are being used to decide trades for you. Others are used to signal market conditions. However you want to use trading bots, you can learn about your potential below.
What Are Trading Bots?
Crypto trading bots are programs designed to recognize price moves and then execute live trades. The trades executed by software work on triggers. If prices rise to a certain point, for example, a trade is automated instantly. Others rely on bots to execute more trades in one minute than they’d achieve in a week. From using set boundaries to analyzing live markets, bots give traders insights into likely outcomes.
Choosing and Setting Up a Bot
The steps you need to take to set your software up are below:
- Find a Broker: Crypto brokers are trading platforms where cryptocurrencies are exchanged. To make a bot work, you need the right API code to connect with your trading platform.
- Ask About Compatibility: Be sure to research compatibility if you don’t yet have a broker. Not all crypto platforms have the same connections.
- Set Your Strategy: Now determine your trading strategy. Bots can be adjusted via settings or are initially created for your trading style.
Tips for Bot Trading
Crypto bots are purely automated, but you can still intervene within your software. Whether you need to micromanage your bot or prefer to “let it go,” experience is key to your success. If you don’t have that experience, consider the tips below:
- Set Risk Tolerance: No matter how great your bot is, you will eventually lose if you end up risking too much. Let your bot do its job, but decide on its financial limits.
- Save Settings: Be sure to save your personal settings. What was easy to configure at first can be complicated when, without a record, it’s attempted again.
- Remain in Control: Work for a balance between your trading and your robot doing so. Rely on both but not without confirming the performance of the other.
- Use Indicators: Technical analysis is what trading bots use, which consists of indicators and price charts. It’s a good practice to know which triggers your robot relies on.
Are Crypto Trading Bots Profitable?
According to the experts at SoFi, you can rely on crypto trading bots as long as you remain the central administrator. An advantage of bots is their tendencies to be consistent. What might stir us up emotionally won’t be significant to a bot.
Crypto bots by SoFi are solutions for those who want a balance in how they trade. Consistent results require technology that’s proven effective in all market conditions.