Automation is one of the buzzwords that has been around for some time, and for a good reason. The rising technological prowess has enabled the creation of software, as well as hardware that can eliminate the need for manual human interference for greater efficiency, reduced margin of error and lower costs. Similar principles hold good for crypto trading as well, and there are a number of platforms and software services that allow for automation of various aspects of trading activity.
When it comes to trading, the automation is classified under two broad categories – market analytics using advanced machine learning and artificial intelligence to generate trading signals and then the trading bots that places orders on behalf of traders based on pre-set inputs. There is also a possibility to bridge both these systems to create a completely automated system to execute trades at a much higher profit ratio than manual trading.
Advantage of Automated Trades
The financial markets have a volatility factor associated with it, which is generally influenced by a much broader industry, policy and geopolitical developments. Also, most of the traditional markets have fixed timings each day and remain closed during weekends. However, the crypto market is entirely different, even though most of the underlying driving factors remain the same as traditional financial products. For starters, the crypto assets led by Bitcoin are much more volatile compared to stocks or forex. Further, the crypto market never sleeps, and people can trade round the clock, 365 days a year which makes it important for traders to continuously monitor the price movements and place orders accordingly in order to get better profits. It is virtually impossible for anyone to get the best value out of trading unless aided by external resources. This is where trading bots come to the rescue.
Trading bots are pieces of software that can be integrated with a user’s account on a cryptocurrency exchange or a trading platform. After connecting, the trader will enter desirable parameters such that whenever the market conditions satisfy defined conditions, the bot will execute a buy or sell order. By making use of these bots, traders don’t have to continuously monitor the market, place orders and wait for them to be executed so that they can repeat the process all over again. Some automated trading software doesn’t require the user to connect their existing trading account, instead, they can directly trade from within the platform.
Efficient Trading
However, the efficiency of trading bots widely varies depending on their usability as well as capabilities. A trading software that’s easy to set up, understand and capable of swift execution of trades when parameters are met, have an obvious advantage over others. A handful of automated trading platforms like Bitcoin Future satisfy all the parameters and goes a step beyond that by offering trial or demo accounts where people can familiarize themselves with its functioning without having to expose their funds to market risks until they are convinced. Once convinced, they can start live trading, and let the software analyze markets, pick profitable trading opportunities and place orders accordingly.
Another important thing to consider while using automated trading accounts is the minimum deposit, the success ratio of such automated trades placed through the platform, and any deposit and withdrawal fees. If the platform has a high success rate, great track record, low transaction fees and requires minimal attention for the user, then such platforms are worth considering in order to maximize the ROI in crypto trading.
Image by Gerd Altmann from Pixabay
