Amazing Facts on Cryptocurrency Trading Bots
A common feature among all cryptocurrencies is that they are very volatile. They can rise rapidly over a couple of hours and drop just as rapidly. Traders in the cryptocurrency space utilize various skills (like fundamental analysis or technical analysis) to assess the market and make a decision. Traders are divided into two categories- those that prefer to do their own trading and those that prefer bots to do the trading.
Crypto currency trading using bots is easier but you need to know what you are getting into before you choose a bot to do the trading for you. In simple terms, cryptocurrency bot trading involves letting a computer program decide all your trading decisions and execute them for you. Bots work by connecting to exchanges and carrying out trades as they have been programmed. Bots gather facts on issues like price movement, volume and time then make a decision. Various traders have various trading needs and they can customize the bot to handle trades as per their preferences.
The cryptocurrency bot trading industry is also full of scammers and some faulty cryptocurrency bots. Thus, before you pay your hard-earned money you need to find out if the company is legitimate and they will not scam you. A great source of information on cryptocurrency trading bots are online forums that have people that have used the bot before. Steer clear of companies that have negative reviews and a lot of customer complains.
Trading bots have been in existence even before the advent of cryptocurrencies. They have been in use for a long while but they have never been popular for the average investor since they do not have direct market access. When you trade without a bot the transaction is done immediately but the transaction has to be fully filled by the brokerage firm. In the cryptocurrency world traders are granted direct market access thus they can use bots to trade unlike in traditional.
Unlike traditional markets that close for the day cryptocurrency markets run twenty-four hours a day.For a trader this can be an advantage or disadvantage. The fact that the market is open means that there are more opportunities for you to capitalize on. The disadvantage is that you cannot always be awake to monitor the market and it can crash when you have gone to sleep. The good thing is that with a trading bot you can sleep in peace and let the bot handle all your trading needs.
Benefits of using trading bots
Bots can run continuously without fatigue thus they will trade for you even when you go to bed. Bots do not have human fallibility because they are programs that follow set commands. The popularity of crypto trading bots could be explained based on the facts discussed earlier.