Interesting Facts about Crypto Trading Bots
All cryptocurrencies have one thing in common- their volatility. Crypto currencies can skyrocket in value within a matter of hours and the nose dive just as quickly. Cryptocurrency traders still utilize tools like technical analysis to guide them. There are two kinds of traders- the ones that use old-school trading methods and the ones that have embraced technology and use bots.
One of the advantages of crypto trading bots is that they make trading easier but the user needs to know what they are doing. Bot trading is letting a computer program handle cryptocurrency trading for you. Bots are computer software that connect to coin exchanges then conduct trades as per the instructions of the trader programmed in them. Bots interpret a market based on various factors like volume, price movement and time. Various traders have various trading needs and they can customize the bot to handle trades as per their preferences.
Just like any other Internet business, the cryptocurrency is riddled with scammers and faulty 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. You can ask around from online forums on legitimate and good cryptocurrency bot trading companies. Avoid companies that people complain about a lot.
Trading bots have been in existence even before the advent of cryptocurrencies. The reason, why these bots have been unpopular, is because they lack direct market access (DMA). 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.This can be either an upside or a downside for the trader. Because the markets run all the time this means creation of more opportunities that you can take advantage of. The downside is that human beings need to sleep and the market can fall when you are asleep. However, with a trading bot trading can happen even when you are asleep.
Advantages of using a trading bot
Bots never need time to rest thus they can run for 24 hours and take advantage of any opportunities that may come up when you are asleep. Bots have no errors since they follow set commands. The facts discussed above prove one thing–that crypto bots are likely to be the norm for any cryptocurrency trader.