Ultimate Guide to the Best Bitcoin Trading Bots
Cryptocurrency trading is gaining more and more popularity and is becoming one of the most popular types of investments. However, trading is a very complex process that requires a lot of attention and time.
In contrast to traditional stock markets, crypto trading never stops, making it nearly impossible for traders to track market fluctuations, reduce risk, eliminate errors, and profit from the trading process 24 hours a day. Therefore, many traders use cryptocurrency trading bots to make trades faster and more efficient.
In this guide, we will be considering the meaning of bitcoin trading bots and how traders can use them in the crypto market.
What is a bitcoin trading bot?
Bitcoin trading bot is a software program that automatically buys and sells various cryptos at the right time to generate a profit. It enters trades based on pre-established parameters.
Due to the crypto trading bots, traders will not miss the opportunity to enter profitable trades by running a set of algorithms and will be able to open orders in time.
How does the crypto trading bot work?
Bitcoin trading bots work under special algorithms, trading strategies, which, in turn, are based on technical analysis. To make an independent analysis, traders need historical data on price changes (charts, at least for the last year). Sometimes it is possible to determine an association with the news.
Besides, after conducting a technical analysis, the strategy is tested on the same historical data, and the number of potential losses and profits is calculated. And if the results are satisfactory, the rules of the trading strategy of the cryptocurrency trading bot are created on their basis. Some bots additionally utilize indicators that provide you with the opportunity to analyze the current situation on the market, others are executed only when certain market conditions occur.
The trading strategy of crypto trading bots can be very simple, for example:
- When there is a fall in price, the bot buys the digital coins.
- When the price rises, the bot sells cryptocurrency.
In addition, the bot can use more complex trading strategies. The algorithm can consider the last historical data, indicators, and navigate by signals. High-quality crypto bots analyze over a hundred parameters while placing orders. In some programs, the algorithm does not change, but there are bots that can be connected or customized with additional settings. This option suits experienced traders who have their own trading strategies and preferences.
Crypto bot can implement the following actions:
- Evaluate the market situation, monitor the course for a given period of time, predict possible profitable trades. It can provide traders with signals during manual trading.
- Place sell or buy orders.
- Report back on profit or loss.
How to get cryptocurrency bots?
There are three options for obtaining bots for crypto trading coins:
- Creating a bot from scratch.
This option is suitable for those who are familiar with programming. All bots are created exclusively for some exchange. Accordingly, the platform must offer an API. This is a set of information about the state of trading and a set of functions that allows you to start trading according to user-defined parameters.
- Buying a crypto trading bot.
This option is suitable for users who do not know how to program. Today, quite a lot of companies are engaged in writing this kind of software. Moreover, not only the purchase is offered, but also the temporary rental of the bot.
- Downloading the bitcoin trading bot for free.
The third option is to download bots for free. The advantages of this option are no need to invent anything, write programs or pay money. But the disadvantage is that the user cannot be sure that the bot will not start, for example, transferring all earnings to internal accounts of third parties.
The main advantages of cryptocurrency trading bots
- Decision-making speed. Even experienced traders need some time to analyze the market. Beginners do everything even more slowly. As a result, a trading opportunity may be missed. In order to avoid such situations, many traders prefer to use bots. They analyze everything much faster and make decisions faster than a human.
- Ability to analyze an unlimited number of pairs. If we compare a bot with a human in this parameter, the advantage is again on the side of the first. Sometimes, a person is simply not able to analyze a large number of assets and make the right decision. Therefore, many traders leave this work to bots.
- Absence of errors in the algorithm. A person can make mistakes in the process of market analysis. This is due not only to the level of training but also to the psychological state of the trader. Bots work clearly within the framework of the algorithm. If there is a signal, the bitcoin trading bot will use it.
- Trading 24/7. Every person needs rest. Many people cannot devote more than two hours a day to trading. The bot trades around the clock.
- User’s free time. The use of bots involves giving a person more free time. After all, he does not need to analyze anything. And many algorithms are set up to fully automate trading from the moment a signal appears to the moment a decision is made.
- Lack of emotion. A person is subject to various psychological states, which can affect the results of trading. The crypto trading bot does not experience any emotions. He has no passion. It operates only within the framework of its algorithm.
- Discipline. Many traders do not know how to properly manage capital. The bot for the cryptocurrency market will operate according to the algorithm pre-installed in it. For example, if the limit amount of the deal of $10 is set, the bot will never change it on its own.
Disadvantages of bitcoin trading bots
- Action patterns. Bots are not capable of independent analysis. They cannot understand when the market situation is changing. Accordingly, this can lead to a complete loss of the deposit.
- The absence of emotions. On the one hand, it is an advantage but on the other hand, it is also a disadvantage. For example, the fact is that a person can decide to end trading for a day, after a certain number of unsuccessful trades. After a while, he may make changes to the system and start working again. The crypto trading bot will trade until the trader stops it or the funds on balance run out.
- The need for constant monitoring by the trader. Many people suppose that a bitcoin trading bot can be left to its own devices. It is a wrong opinion as unexpected errors may occur. Traders should monitor the data reports and never provide access to a crypto bot to all your assets.
- The risk of software failure. This risk always exists, even if it is admittedly less frequent. You should keep in mind that not all crypto bots are developed by professionals, and even pro-bots are not perfect. Bots are built on specific codes and algorithms that help them function. Mistakes can happen during the development process, leaving the bot inefficient at particular points in time.
Cryptorobotics trading bots
Nowadays, there is a wide range of crypto trading platforms that offer traders the use of bots. Cryptorobotics trading bots are considered among the best. They have a lot of functions that help minimize risks and increase profit. These bots are intended for completely different purposes and enter the trades in different market trends. Let’s take a closer look at these bots, the differences between them, and which one will be suitable for you.
These are crypto bots that can enter trades in short and long positions. Therefore, they can bring profit both in rising and falling markets, and also allow the user to choose the leverage for trading. These types of bots fall into three types and vary by the level of risk management and the number of crypto pairs. Let’s take a closer look at them.
Conservative is an automated system that trades on Binance Futures and uses ten major crypto pairs in its trading. Thanks to this bitcoin trading bot, a trader can use both long and short strategies in his trading. The user can set the parameters in the risk management system of the bot – a conservative Take Profit and Stop Loss level and the percentage of the balance drawdown.
Moderate is an automated system that trades on Binance Futures and can use 20 major crypto pairs in the trading. It gives signals for short and long strategies and allows users to set a moderate Stop Loss level and balance drawdown percentage in the risk management system of the bot.
Risky is a type of Crypto Future’s bot that enters the trades on Binance Futures and uses 30 crypto pairs in its trading. To use this bot, you can set the risky level of Stop Loss and the balance drawdown percentage in the crypto trading bot‘s risk management system.
Optimus is designed to enter the trade on low price volatility. It opens orders at positive price fluctuations and closes them in accordance with certain oscillators and indicators configured by the algorithm. This bot supports the following exchanges: Binance, Binance.US, Bittrex, CEX, Bitfinex, EXMO, Huobi, Kraken, OKEX, Gate.io, P2PB2B, Poloniex.
CyberBot can trade on the growing market. It never enters the trades against the trend. Owing to this, it reduces the risks of losing funds and increases the chances to get a profit. Traders can use this crypto trading bot on the following exchanges: Binance, Binance.US, Bittrex, CEX, Bitfinex, EXMO, Huobi, Kraken, OKEX, Gate.io, P2PB2B, Poloniex.
The one bot
The one bot is a crypto trading bot that has been tested using unique tools in the algorithmic trading system. This bot uses custom indicators for buy and sell signals, showing a stable result in the long run. It can trade using a high-risk strategy, thanks to the proven effectiveness of trading 150 cryptocurrency pairs. This bot can open long and short positions on the following exchanges: Binance and Kraken.
How to start using Crypto Future?
- Go to the “Algotrading” tab.
- Select the “Trading robots” section.
- Choose one of the crypto trading bots: Conservative, Moderate or Risky.
Once you choose one of these bots, you can start the trading process. Let’s take a closer look at how you can run this bot.
- Go to the “My robots” tab.
- Click on the “Manage” button.
- Select “Work mode”.
- Go to settings.
- Select the Binance Futures exchange.
- Get verified on the exchange.
- Bind an account to the terminal using an API key.
- Select currency and balance for trading.
- Choose leverage for trading. (It is not recommended to use large leverage, as this carries the additional risk.)
In order not to lose your funds, if there are unexpected fluctuations in the value of digital coins on the market, it is necessary to specify an acceptable loss percentage. That is, you can choose the option in the risk management section to stop and sell everything or just stop buying if your balance starts to fall below the specified percentage.
After clicking on “Edit robot and start”, the bot will start trading with the specified settings.
It is worth noting that there are two modes in the terminal – Test and Work mode. If you have not used these trading bots yet, you can test them in “Test mode”, while the bot will enter real trades right on the schedule, taking into account the order book, but your balance will not be affected.
How to set up Optimus and Cyberbot crypto bots?
- Go to the Algotrading tab.
- Select “Trading robots”, and then click on the “My robots” button.
- Click on the Manage button.
- Choose Test or Work mode.
If you just want to see how these crypto trading bots function without using your own funds, you can select the “Test mode”. In order to start full-fledged trading, you need to select the “Work mode”.
- Click Settings in the upper right corner.
- Select an exchange.
- Pass verification.
As we have already mentioned, if you choose the Binance exchange, you do not have to go through the complicated verification process by creating a sub-account.
- Choose a cryptocurrency for trading;
- Select crypto pairs;
- Specify timeframe and trade balance;
- Indicate total balance.
The traders can also customize Stop loss and Take profit to make the trading process more efficient, safe, and profitable.
How to start using The one bot?
- Go to the “Algorithmic trading” tab.
- Select the “Trading robots” section.
- Select The one bot.
- Press the “Test” button.
It is worth noting that for testing, it is necessary to have any paid PRO package.
- Click on the “My robots” button.
- Then press the “Manage” button.
You will see a window with the parameters and settings of the crypto trading bot, where there are two modes – Test and Work mode. If you are not sure if this bot is right for you, you can test it in “Test mode” and the bot will enter trades in real-time without affecting your balance.
If you are ready to run this bot in Work mode, then you need to follow these steps:
- Select Work mode.
- Go to settings.
- Choose an exchange (Binance or Kraken).
- Get verified on these exchanges.
Important: It is worth noting that if you choose the Binance exchange, you can bypass the complicated verification process and use the Cryptorobotics terminal services. We will create a sub-account for you on this Binance to make it easier to start trading on this exchange. Step-by-step instructions on how to connect a sub-account on Binance can be found here.
- Choose one of the keys or accounts.
- Specify a balance for trading.
The bitcoin trading bot calculates the amount of the transaction in the amount of five percent of the total balance. In the trading itself, the bot can use only half of the allocated balance in accordance with risk management.
- Click on the Edit and Start button.