Millennials have become increasingly interested in investing in recent years. Because of the high risk and high return features of stocks, bonds, and now cryptocurrency, many people have switched.
Being a first-time crypto trader can be scary. As a result, the concept of copy trade emerged. It simply includes directly replicating another trader's positions or emulating the strategies of important traders or influencers.
Let's define the term "copy trading."
What exactly is copy-trading?
Around 2005, automated trading evolved into copy trading or mirror trading. That year, Tradency was among the first to incorporate Mirror Trader, an automated trading system, into their system. It simply includes directly replicating another trader's positions or emulating the strategies of important traders or influencers.
As a result, it has gained in favor among online financial trading organizations since 2010 as a tool allowing less-experienced traders to profit from more experienced investors' successful trading decisions.
Crypto copy trading platforms are designed so that new investors do not have to spend years learning how to record profits through trial and error. You are also not obliged to take training on how the bitcoin market works. As a result, learning about the bitcoin market will not necessarily cost you money.
Having Used A Variety Of Crypto Trading Bots
From my personal trading experience with numerous crypto bots and platforms, here are a few general tips for getting started with bots:
First of all, you should never put your cryptocurrency into a "smart contract" with a "black box" bot that promises you a return. Only by connecting to your account at a major cryptocurrency exchange can you use a genuine bot. All of your bot's orders and trades should be visible to you. Bots shouldn't be able to access your exchange account by using your API keys. Trading authorization is sufficient for all conventional tactics.
Risk should always be capped. Create a fresh profile on your market. By setting aside this sum, your maximum possible loss will be contained within this account.
Get humble. Most marketplaces have a minimum order amount of around $10. To test out the crypto trading bot, you only need to deposit the equivalent of 10-20 orders.
Take precautions. Only use Coinmarketcap's high-volume trading pairs. Top 10 is probably the best option. They're volatile enough to let robots do their thing, yet liquid enough to get out of a trade quickly if necessary.
Exercise restraint. Don't try to capture every shift in price by setting bot triggers too low. Let's say that for most newbies, a percentage between 1 and 5 would be appropriate. This means that the market price must change by at least 1% in order for your bot to execute a single deal.
For those who find themselves in the unfortunate position of having their cryptocurrency bot buy too many coins during the abrupt market collapse despite taking all necessary measures (or because they choose to ignore them), there are a few options to consider.
Fix loss. Deactivate bot, sell coins manually. Proâyou'll release funds for a future trade immediately. Contra â you can't recoup this trade.
Be patient. Expect the market to strike your take profit order and the bot to complete its task. Pro: This transaction still pays. Contra - cryptocurrency market may plunge deeper and never recover, freezing your funds in an uncomfortable trade.
Another bot should sell bought coins amid market growth in the opposite direction. As a compromise between the first two alternatives. Although the bot may not sell all coins profitably, it can gradually diminish your stake.
Buy more trade positions, stop the bot, and lower the average purchase price. Try to sell your position for less profit. The riskiest option, this is not suggested for novice traders.
