cryptocurrencies if bitcoin (BTC) and ethereum (ETH) are known to be highly volatile with prices regularly fluctuating drastically within minutes. Investors usually cannot react quickly enough to these price changes to execute the optimal trade. In addition, most traders do not have the time to constantly monitor the market. You would then have to monitor the . 24 hours a day cryptocurrency exchanges†
One of the most popular solutions to this problem is the use of so-called ‘trading bots.’ These are instruments that can automatically execute trades for you. You can automate your trading strategies with it and usually require no programming knowledge. All you need is a list of assets you want to trade in and your desired entry and exit prices.
Benefits of KuCoin trading bots
KuCoin, one of the largest crypto exchanges in the world, offers its users access to these types of trading bots. KuCoin’s bots are active 24 hours a day, so they don’t miss the best trading moments. Timing is very important in crypto trading and has a major impact on your potential profit. The market runs 24 hours a day, so if you want to trade optimally, you have to sit in front of your screen all day and observe the prices. Nobody actually has time for that, so a trading bot is a great solution. KuCoin’s trading bots follow the prices all day and can close positions at the right times.
In addition, the bots help with your risk management. KuCoin’s trading bots are very useful for tracking and making the most of market fluctuations. In a rising market, the bots will help you make profits using different strategies. But even in a declining market, the bots can help you minimize your losses and reduce your risk of loss.
KuCoin, also known as the “People’s Exchange,” offers trading for over 700 different crypto and over 1,200 trading pairs. The exchange announces that its users have already created 6 million trading bots.
Five different trading bots for five trading strategies
KuCoin’s trading bots now support five different trading strategies. Those are Spot Grid, Dollar-Cost Averaging, Futures Grid, Smart Rebalance and Infinity Grid. Read more about what these mean below.
Spot Grid: Earn passive income by buying low and selling high
The Spot Grid is one of the most classic and most popular trading strategies. It is simply selling high and buying low in a specific price range. It is still a good strategy to make a profit in a volatile market. Higher volatility can actually yield higher returns.
For example, if you expect bitcoin to fluctuate between $50,000 and $60,000 over a period of time, you can set these prices as the range of your Spot Grid. Spot Grid is generally a relatively low risk strategy. However, it does require patience. Most bots that run for a longer period of time will usually make more profit.
The Spot Grid has two functions to make things easier for newcomers. The first is called AI parameters which allows you to directly use the recommended settings based on the historical data of the crypto.
In addition, you can also copy the settings of others, also known as copy trading† Here you can take over the settings of the biggest earners with the help of a ranking in just a few clicks. As you become more familiar with the system, you can also adjust the parameters yourself.
Dollar-Cost Averaging: Lower your average entry price through continued investment.
Dollar-cost averaging (DCA) is a strategy for dividing your total investment over periodic purchases. This way you can reduce the impact of volatility on the total purchase. Imagine that you bullish are for bitcoin over the long term and want to spend 5% of your monthly income on it. Previously you had to make these kinds of investments manually every month, but with the DCA bot it is much easier.
The DCA bot automatically buys a certain number of pre-selected tokens at a pre-set time interval. For example, you can buy $50 worth of BTC every day at 8 AM to slowly grow your holdings in BTC. The DCA bot will then optimize the average entry price.
DCA is an old strategy from the financial world and works best in the beginning of a bull market. You can set a target with the DCA bot when you want to take profits. Once this goal is reached, you will be notified if you want to take the winnings.
Futures Grid: The Spot Grid for the futures market.
The Futures Grid Bot is similar to the Spot Grid Bot. Both bots allow you to earn passive income by automatically buying low and selling high. The Futures Grid Bot also has two other unique features that can help investors increase their profits.
With the Futures Grid Bot you can choose whether you lung or short goes. That means you can also make a profit in a market that is in a downtrend. In addition, also leverage, or leverage, supported by the Futures Grid Bot. You can increase the return on your winnings up to 10 times with this. Keep in mind that a higher return also means a higher risk.
Smart Rebalance: Grow your portfolio even if you’re HODL.
The Smart Rebalance bot is a convenient way to manage your portfolio. It is ideal for long-term investors with a diverse portfolio. The bot can help investors increase their returns. Let’s say you want to allocate 40% to BTC, 30% to ETH and 30% to KCS. If you simply hold these tokens, these percentages will change due to the changing value of the tokens themselves. The Smart Rebalance Bot can then automatically rebalance your portfolio so that it meets your expectations. The bot sells the tokens whose percentage has increased and vice versa.
Infinity Grid: a strategy derived from Spot Grid
The Infinity Grid bot is designed to prevent you from “missing” rises in crypto. It is similar to the Spot Grid Bot, but does not trade in fixed numbers, but in percentages and there is no upper limit.
When the market rises, the Infinity Grid Bot can keep you buying low and selling high. Take, for example, the trading pair BTC/USDT† When crypto prices rise, the bot will regularly sell BTC, but also ensure that the amount of BTC is equivalent to the initial USDT you hold.
The above article is a submitted piece and is not the responsibility of Crypto Insiders. This is not financial advice.