Do you know that a bot can elevate your Bitcoin trading game? You most likely know about Bitcoin’s volatility. On some days, you can triple or double your investment. However, you can lose all the money you’ve made trading Bitcoin in a second.
Currently, the crypto market is largely unregulated. Therefore, some traders can influence the crypto market or rig prices in their favor. Consequently, some people can quickly lose money when trading Bitcoin or investing in it directly.
Unlike the traditional stock market, the Bitcoin market doesn’t have a closing time. Thus, it runs 24/7, and manual trading can be complicated. Ideally, many people don’t have the energy and time to trade Bitcoin manually throughout the day. And that’s where a Bitcoin trading bot like “Immediate Edge” comes in.
What is a Trading Bot?
The most straightforward trading bot definition is a computer program that can automatically trade Bitcoin or any other digital currency on your behalf. That means a trading bot can place Bitcoin’s purchase and sale orders while you sleep based on your specified parameters. What’s more, fear, greed, and other emotions do not motivate or influence a bot, thereby improving accuracy.
Currently, trading bots undertake around 70-80% of the total crypto trading volumes. A bot can also monitor different crypto exchanges and use pre-defined rules to trade. The most popular are arbitrage bots, trending bots, and coin lending bots.
However, trading bots have a fee, with most sophisticated programs being costly. For instance, you can pay between $10 and $100 per month to use a trading bot. However, this amount is worth it for anyone serious with Bitcoin trading. But bots are not 100% perfect. Therefore, you will monitor your account and change some rules to get the most from your trading activity.
Reasons to Use a Bot in Bitcoin Trading
Bitcoin and other electronic currencies are incredibly volatile. Their prices can fluctuate dramatically within minutes. Also, many investors want to take advantage of the best Bitcoin price worldwide. These and other factors combined can limit human effectiveness in crypto trading.
For instance, you may not react faster to price changes to optimize your trades. Also, transaction times and exchanges slowdowns can escalate the problem. Also, you can’t dedicate all your time to Bitcoin trading, analyzing the market to determine when to buy or sell. Ideally, this would require you to monitor crypto exchanges worldwide around the clock.
- A bot is an automated tool for trading and executing transactions on human investors’ behalf. Here are the top advantages of using a bot in Bitcoin trading.
- Traders use bots to benefit from the Bitcoin market by trading 24/7.
- Bots react faster than human investors, thereby exploiting the best market opportunities.
- Most investors lack adequate time to dedicate to market analysis and trading, but a bot can do this.
- A Bitcoin can analyze different crypto exchanges to notice price differences and take advantage of them.
Essentially, a Bitcoin bot analyzes market data while predicting risks to determine when to purchase or sell the crypto asset. Thus, it monitors the market and trades at specific market conditions. In most cases, a bot connects directly to the crypto exchange to execute trades at the most appropriate, pre-defined moment.
Final Thoughts
A trading bot allows a trader or investor to automate the purchase and sale of Bitcoin depending on technical indicators and implements strategies to attain the highest profitable trades percentage or win rate. For instance, a bot can implement methods like crossing moving averages and triggering automatic purchases and sales. Nevertheless, using a trading bot or not depends on personal preferences.