Facts on Crypto Currency Bot Trading
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. Traders use various tools, like technical analyses as well as fundamental analysis to capitalize on market changes. Traders are divided into two categories- those that prefer to do their own trading and those that prefer bots to do the trading.
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 work by connecting to exchanges and carrying out trades as they have been programmed. The decisions made by bots are based on various factors like volume, price changes and time. Most trading bots can be customized to the needs of the trader.
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 get good information on the bot you want to pay for by asking on online forums for cryptocurrency enthusiasts. Steer clear of companies that have negative reviews and a lot of customer complains.
Trading bots are not a new concept in traditional trading markets. 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. Normally, although traders trade in real time but for the trade to be effected a brokerage firm must fulfill the trade. Bots appeal to cryptocurrency traders because they have direct market access thus can set up bots to handle all their trades.
Crypto currency exchanges run for 24 hours a day every day of the year.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 downside is that you can never be awake for 24 hours a day thus the market can crash without you knowing it. This is why it is a good idea to get a trading bot that can work for you 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 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.