Why this is the Best Time to Run a Cryptocurrency Trading Bot
Successful traders prepare themselves by waiting for the right opportunity before making their moves. Sometimes the right thing to do, in a market is to do nothing. It takes both knowledge and patience to recognize when its time to wait and when is act.
A healthy market needs volatility. And boy did the crypto market deliver.
Just this month, Solana saw a dramatic price fluctuation. It rose over 300% from the end of October, now trading at around $56.
BTC, ETH as well as many other alts have also seen dramatic spikes in price. This kind of volatility is exactly what cryptocurrency trading bots are for.
You see, every drastic market movement is usually followed by a correction. Its these corrections that offer some of the best opportunities to pocket in some profit while increasing the size of your investment.
Its hard to determine exactly the threshold at which point a spike will have a sudden and immediate correction, but with practice, youll get better at detecting them.
For instance, take a look at the chart below.
This is a 10% pump followed immediately by an 8% correction. Timing this perfectly is nearly impossible, but entering around the time the spike has ended, or shortly after can still generate a good, and more importantly, consistent return.
The best thing about this approach is that in the current market conditions is that its repeatable. Because its repeatable, its the perfect strategy to consider automating.
Why this is the Best Time to Run a Cryptocurrency Trading Bot
Algorithmic crypto trading platforms like Aesir are perfect for automating these kinds of strategies. Theyre easy to use and best of all, allow you to safely test a strategy in a virtual environment with no risk, so you can double-check that your strategy indeed works the way you intend it to, without exposing yourself to unnecessary risks.
Not only are the market conditions ideal for this kind of swing trading, but many Algo trading platforms out there are also giving out massive Black Friday discounts for a limited time.
For instance, Aesir is offering 70% off on all subscriptions forever with code AESIRBF70 at checkout. This is the best value that users can get, and a premium subscription unlocks powerful new features such as Paper Trading, Trailing Stop Loss, Faster execution, and more complex trading bot logic.
The only thing to keep in mind is that testing a strategy is absolutely vital to its success. Especially with swing trading where its unclear where that sweet spot is. Thats why most Algo trading platforms allow you to run multiple bots in parallel to and see how they perform.
However, unlike other platforms, Aesir was specifically designed with swing trading in mind. Whether long or short term, Aesir allows you to select a Price Volatility threshold and a Time window.
For instanceyou could create a bot that scans all coins on Binance and places a buy (or sell order) when the price rises by at least 10% in the last 20 minutes.
Naturally, youre free to use other indicators such as MACD, RSI, and even computed TradingView Indicators. However, many moving average indicators are known as lagging indicators meaning they follow the price, and not the other way around.
Whatever you approachtest and optimize.
Thats all for today. If you do want to start dabbling into algorithmic trading, dont forget to grab the coupon code for AesirAESIRBF70
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The post Why this is the Best Time to Run a Cryptocurrency Trading Bot appeared first on cryptomaton.
Text source: Automated Cryptocurrency Trading
