Cryptocurrency trading is challenging as there are many variables involved. Even the most experienced traders struggle to consistently make profitable trades due to their human flaws.
As a result, automated cryptocurrency trading was invented, which involves the use of trading robots to automate trades. This turns out to be beneficial as human shortcomings such as emotions are eliminated in trades, increasing the likelihood of their success.
So, what are cryptocurrency trading bots, how do they work, and who can use them in trades to increase their chances of winning?
What Are Cryptocurrency Trading Bots?
Cryptocurrency trading bots are bots that are used to automate trades. They are basically programs that are implemented to achieve specific results in trades.
Although you can only go to a crypto bot trading platform and use trading bots with pre-set rules, you can also program them to suit your trading needs. For example, you can change the settings on the bot to make it buy a certain cryptocurrency at a certain time or price, depending on your crypto trading strategy.
Crypto bot trading platforms also provide back-testing services that allow you to test such a strategy before deploying it to your trade. This greatly reduces your risk when you enter into such a trade.
Another important role that cryptocurrency trading bots play is eliminating human emotions in trading decisions. No matter how experienced you are, emotions can overwhelm you and make mistakes that can cost you a lot of money in trades. Once again, it is about trading psychology and how it affects cryptocurrency trading.
Bots carry out instructions and cannot change them because they have no feelings, which can save you from losses. It also does not require any high level technical skill to operate, which makes it a turnkey solution for trading these days.
How Do Cryptocurrency Trading Robots Work?
Cryptocurrency trading bots are hosted by platforms like Coinrule , Cryptohopper , etc. These platforms create cryptocurrency trading bots with specific rules that apply to trades, but you can modify them to suit your specific goal.
Perhaps the most impressive thing about them is that they are trading 24/7, something no human being can do. You can program it to execute trades at specific times, day or night, depending on how the market is moving.
Some bots have special features that set them apart, such as the HODL feature on 3Commas . This not only trades, but also helps you to buy and hold cryptocurrencies automatically by buying at low prices. It is up to you to decide which cryptocurrency you want and choose a bot to help you achieve it.
However, you should know that although trading robots are good for automating trades, they can be a drawback if the trade does not go according to plan. This is because they cannot change the instructions already given.
Who Can Use Cryptocurrency Trading Bots?
As mentioned earlier, cryptocurrency trading bots do not require special programming or other skills to be used. Therefore, even a complete trading novice can use it in trading.
Of course, advanced traders are also at risk of letting their emotions or other issues get in the way of getting trades done. To help, they deploy trading bots sometimes, for example, when they need to execute a trade at night.
They cannot trade all day and all night, so trading robots can be useful at such times or when they are busy with other engagements.
In short, everyone uses cryptocurrency trading bots, if not because they are new and have little experience, then because they cannot execute the trade themselves at the best time.
Can Cryptocurrency Trading Bots Help Your Trades?
Cryptocurrency trading robots can help you with your trades, especially if you are a beginner. Take the time to read how each crypto trading bot works on the platform of your choice, and remember that a cryptocurrency trading bot is not a guarantee that you will make a profit.
