What Are Crypto Trading Bots?
With the interest of cryptocurrencies growing over the last year many people are looking to get involved. Whether you are looking to get involved, have been using crypto for awhile, or have a vast knowledge of cryptocurrencies, I am sure you are still trying to get the edge and make the most of your investments. Many times people are trying to find a way to trade or get the best price per coin however most do not have the time or ability to watch a chart all day long.
This brings up another option: A Trading Bot. Trading bots are programs that will run without a human actually making choices for them. There are a few things that the bot requires from the human, however it takes a lot of the psychological side, or the FOMO (Fear Of Missing Out), out of the equation and makes it easier to make better trades. It also makes more time for individuals who do not have the time to try to chart a coin, or watch a pair in order to get the best price.
Common Types of Trading Bots
When looking at starting a trading bot there are several different types to use. One that many people enjoy is called a grid trading bot. A grid trading bot will set up several grids all through a few different prices and buy and sell automatically within the high and low of those areas.
For an example I will use Bitcoin. I might set a higher limit of 65,000 and a lower limit of 30,000. I will set how many grids I would want to use and while BTC moves between these to numbers the bot will automatically buy and sell for a profit without myself doing anything.
There is also a bot called a trailing buy or trailing sell. With this bot, you will set a trigger price, and then the bot will run. Once the price is triggered it will move a percentage until there is a buy or sell that has been made.
I will use Bitcoin again for this example. I want to buy BTC but only at the price I feel is as low as it can go, but I also want to let the buy price trail if it keeps going lower. So I will set up a trailing buy. With this I might say I want to buy Bitcoin when it bounces back 5%. WIth a trigger price of 35,000. So that means my bot will watch the price of bitcoin and when it hits 35,000 it will trigger, and the bot will start. With this, the bot will buy BTC when it rebounds from the lowest point and comes back up 5%. So once it is triggered, and say it goes down to 30,000 and then back up 5% to 31,500 it will trigger the buy. But, if BTC only goes back up to 31,499 and then tanks back down to 28,000. The new buy price will be 29,400. So it will continue trailing the lowest buy price by 5%. The same thing works with a trailing sell but in the opposite direction.
For a better visual please CLICK HERE to see this video.
There is also another trading bot called a DCA or Dollar Cost Averaging bot. With this bot, there is a set amount you will buy in a specific coin. With this bot you set up how much you buy and what time interval you will buy.
Our next example I will say that I feel like BTC will be a great long term investment. However, I don’t really care what price I pay for BTC, but I know I want to buy and keep more coins. So I could take say $1000 usdt, and create a DCA Bot. With this bot, I can set it up to buy one time a day, for the next 7 days. Or 1 time every hour for the next 36 hours. There are many different ways to set it up. However, it does not matter what the price of BTC is, it will still buy your investment. So if I were to set it up, I could make it spend 10 usdt for each buy. Sometimes the price might be really high, and sometimes it might be really low. However, when you add up everything it will average your cost and hopefully get a good average price for BTC.
Crypto Trading Bot
When looking for a good trading bot there are a few different things that you will need to keep in mind. The first one is how it will work with the exchange that I am currently using. Is it built into the exchange or does it need to use an API in order to access the exchange.
The second thing would be if the bots would cost extra. There are some programs that you can use that will trade for you, however they will also cost money. Sometimes the fees in these bots are so high that it is tough to justify using the bot because you will not have much profit left over after the fees. Other programs are either free, or built into the exchange which would be all profit for those bots to run.
A third thing to be on the watch for is how the bot actually is set up. Some bots can be programmed to “learn” while they run. These are usually very expensive or they take a long time to build. Others give an “idea” of what to look for, or an AI feature, but at times you can end up having part of your investment not used, or the investment isn’t used as efficiently as it could be. Other trading bots have almost complete control over how you set up the bot and can use the trading bot investment in the best way you see fit.
These are a few different things that you will want to keep in mind.There are several types of trading bots out there and we are going to highlight some of these.
Best Paid Trading Bots
Trality – Overall Best Bot
The first trading bot that we are going to talk about is Trality. One of the big features that people like about Trality is the fact that it is python based. That means if somebody knows and has a great working knowledge of the Python language they can actually create their own trading bot and develop it to trade for them. It also includes backtesting as well as debugging and rebalancing should be coming soon
- Exchanges: Binance, Kraken, Coinbase Pro, Bitpanda
- Pricing: Free to around $70/month
- Programing Language: Python – Users can write their own bots and code to help trade for them.
Cryptohopper – Best All Around
Cryptohopper has a lot of bang for its buck. It works with 100+ coins and on 13 different exchanges. It is one of the more popular trading Bots with hundreds of thousands of users. It has different packages you may purchase starting at $0 all the way up to $100 per month. This trading bot has something for everyone. Noob traders will find that this trading bot offers a vast amount of resources in order to help educate the traitor. The trading bot is cloud-based which means you can run it while you are offline. It has a great toolbox for beginners and the user interface is amazing!
- Exchanges: HitBTC, Okex, Bitpanda, Bitvavo, Biance, Binance US, Coinbase Pro, Bittrex, Poloniex, Bitfinex, Huobi, KuCoin, Kraken, Crypto.com
- Pricing: Free to about $100/month
- Programaing Language: No prior programming knowledge needed.
3Commas – Best for Advanced Traders
If you are an advanced Trader then 3Commas might be a great trading bot for you. It has a very advanced strategy when trading, however it is very user-friendly. This makes it a great choice for individuals who are working for themselves and trading while trying to learn the market and adapt to different strategies that are happening in real time.
- Exchanges: Binance, FTX, BitMEX, Beribit, Bittrex, Binance DEX, Binance US, Bitfinex, Bitstamp, CEX.IO, Coinbase Pro, EXMO, Gate.io, HitBTC, Huobi, Kraken, KuCoin, OKEx, Polonix, Yobit
- Fees: Free to $100/mo
- Programming Language: No prior language is needed.
Best Free Trading Bots
Pionex – Best Built In Trading Platform
If you are still not sure where to begin with a trading bot, I would suggest Pionex. Pionex is an actual exchange that has 12 crypto trading bots built into the user interface. You have access to these bots as soon as you sign up and they are free to use. The only thing you would need to do is fund your account and then you can get started.
- Exchanges: Pionex
- Fees: Free – 0.05% trading fee for each grid trading transaction.
- Programming Language – No programing required.
Catalyst – Best Advanced Free Bot
If you are an advanced trader and would love to use a trading bot Catalyst might be for you. When looking at this bot the first thing that someone will notices is how customizable it is with the Python language. With some working knowledge of this language you can create and test very complex strategies and bots. After doing this, you can then work with other users to share notes and data in order to make sure your trading is as effective as it can be.
- Exchanges: Bitfinex, Bittrex, Poloniex, Binance
- Fees: None
- Programming Language: Python
CryptoHero – Best for Beginning Traders
For someone who is very new to trading or very new to the idea of running bots, CryptoHero might be a great starting point. It has the ability to analyze the markets and then make AI suggestions for the bot.
- Exchanges: Binance, Bittrex, Huobi, Okex, Coinbase Pro, FTX, Kraken, KuCoin, Bitfinex, Gate.io, Binance US, Indodax
- Fees: Free to about $30/month
- Programming Language: No programming required.
Crypto Trading Strategy
When choosing a bot, the other idea you need to work into your bot trading is how you actually use the bot. There are several different bots and how to use them. Grid trading is one of the most common is not the most common ways. In order to set up a grid trading bot you would need a higher limit, lower limit, number of grids, and an investment. Click HERE for a video that goes more in depth of how this is actually set up.
How to Set Up Parameters
So you think this crypto bot thing is something you might like. However, you are not really sure where to start. The first thing that you will want to do is to pick a coin. I recommend that when you look for a coin, pick something that you feel is a good investment. That in the future, it will be a coin that will rise in price. You can even narrow it down to 5 or 6 coins that you like and then go from there.
After figuring out several coins, what you will want to then do is look at some Technical Analysis on the coins and the charts. You will want to take into account support and resistance zones and come up with a trading plan. When you feel like you have some good areas to buy and sell then we can go into setting up the parameters.
When you get to creating the crypto bot, there will be a few boxes of “upper limit” and “lower limit”. When you find those two areas you can start getting down to the smaller details. I will use BTC on a daily chart for my next example.
If I wanted to set up a grid bot for BTC I might look at the recent lowest area. It might be 28,000 or it might be 40,000. I then will look for a higher area, it might be 55,000 or I might go all the way to the upper limit of 65,000.
Once I have done both of those limits I need to tell the bot how many grids I want to use. Since there are transaction fees I believe that anywhere between .30% and 1.00% would be a great number for a profit per grid. So please adjust the number of grids in order to make sure you have the correct profit per grid as well. Once that is in, the next thing you need to do is come up with how much you are willing to invest, and put that in for the investment. Once everything has been entered, and you feel like you are ready to start trading, click “create” and let the bot start.
Once it has been started, an important piece is to let the bot work and do its job. You probably will have some time where you might show you are losing money, but as long as it stays in the range the bot will continue to make trades and make profits for you.
Pionex Best Free Crypto Trading Bots
When taking all of this information into account Pionex is leading the pack. They are free to use, with an extremely low trading fee, (0.05%). They have a very large user base that is more than happy to help out with any questions. They have 12 built in trading bots that are very powerful. They also are constantly updating their app in order to give their users the best experience.
If you are interested in signing up with Pionex, CLICK HERE to sign up today!
Written by Gridbot Guru，Gridbotguru@gmail.com