Interesting Facts about Crypto Trading Bots
A common feature among all cryptocurrencies is that they are very volatile. 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. There are two kinds of traders- the ones that use old-school trading methods and the ones that have embraced technology and use bots.
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. Most trading bots can be customized to the needs of the trader.
The cryptocurrency bot trading industry is also full of scammers and some faulty cryptocurrency bots. This is why you need to do your due diligence to find out the legitimacy of the company before you pay for the service. 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 are not a new concept in traditional trading markets. The reason, why these bots have been unpopular, is because they lack direct market access (DMA). Normally, although traders trade in real time but for the trade to be effected a brokerage firm must fulfill the trade. In the cryptocurrency world traders are granted direct market access thus they can use bots to trade unlike in traditional.
Crypto currency exchanges run for 24 hours a day every day of the year.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. This is why it is a good idea to get a trading bot that can work for you even when you are asleep.
Merits of utilizing a trading bot
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 facts discussed above prove one thing–that crypto bots are likely to be the norm for any cryptocurrency trader.