A crypto trading bot and a Online Trading Method is a specific program that operates according to special algorithms, trading strategies, which are created on the basis of technical analysis of patterns. Its aim is to make a profit for users through constant market research and ensure prompt responses to a variety of defined guidelines.
The trading market is active round-the-clock and is extremely volatile, therefore, the need for useful bots that can perform a number of optimized functions is very large. Many Internet users decide to trade crypto passively since they cannot devote the time needed for dynamic monitoring of the market. Thus, crypto bots are extremely useful, and in some cases indispensable for effective trading. One of the best today is the Stoic crypto trading bot API with daily portfolio rebalancing, which can be accessed at stoic.ai.
Read this article in detail about the key elements of crypto trading bots and the benefits of their use or Online Trading Method.
Table of Contents
Components of Crypto Trading Bots
The development of trading bots usually has several features:
- Backtesting;
- Development of a strategy;
- Execution;
- Establishing a work schedule.
Backtesting
When deciding whether to choose one or another bot, you need to test them on historical market data by giving the command to predict old charts. The bot perceives the history of the schedule for real-time trading and makes predictions by recording them for further comparison with the existing schedule and evaluating the effectiveness. Make sure that your last show is realistic just including in the calculations such factors as delay, trading fee, etc.
Strategy Implementation
It is very important to first determine what strategy the trading bot will adhere to. Try to make calculations that will tell the bot when it is better to trade. The created strategy should be tested. The level of its effectiveness should be defined.
Execution
The following step is real-time execution. It involves the transformation of the logic coded in the bot into API requests understandable to the exchange.
Establishing a Work Schedule
After generating and testing strategies in real-time, you should move on to automating the entire workflow. Set a working schedule for the automatic development of trading strategies.
When Is It Appropriate to Use a Crypto Trading Bot?
Thanks to automated trading bots, you can improve the following:
- Monotonous tasks. Surely you have noticed that it takes a lot of effort and time to perform monotonous tasks. The trading bot will help you in quick completing such tasks;
- Timing. Every transaction you make can have a huge influence on your potential profits. Therefore, the bot will help you keep the timing and achieve good accuracy of the obtained results;
- Simplify complex tasks. A great number of strategies can be rather difficult to implement. Bots can be applied to realize them successfully.
Therefore, the use of crypto trading bots is an effective method of automated trading. Don’t forget about it and get benefits.
