Crypto trading (especially using a cryptocurrency bot) has become extremely popular over the past few years and for good reason. The market is changing quickly and crypto assets offer high profits â if you know what youâre doing. Unfortunately, most people donât. Fortunately, you donât have to be a financial genius to make money trading crypto. With a little knowledge and a lot of patience, you can become a successful crypto trader, just like many others.
Crypto trading bots and sniper bots can help you cut down on the time it takes to analyze price movements and make strategic trading decisions. They can also help you make more informed investment decisions, increasing your chances of earning higher profits on any given trade. Weâll take you through the basics of crypto trading bots and highlight some of the best crypto bots available for trading on major exchanges and DEX.
What Is a Crypto Trading Bot?
A cryptocurrency bot is a program designed to automate the process of buying and selling cryptocurrencies. While there are a few general types of bots, for the most part, they can be broken down into two categories: trading bots (focused mainly on centralized exchanges) and sniper bots (focused on token launches on decentralized exchanges).
A technical analysis bot is designed to give you direction based on technical analysis indicators. It uses a combination of the past performance of assets, trading volume, news feed analysis, and other technical factors to come to a conclusion as to where the asset is likely to go in the future. It may or may not take into account the broader market context, such as economic indicators and geopolitical events.
A sniper bot (e.g. pancakeswap bot) is focused on token launches, scans the blockchain for liquidity to be added to a project, and then automatically buys at the lowest possible price. These bots can make you fast profit as they are able to buy and sell in very fast time – much faster than a human could manage to buy manually on a DEX.
Some bots also offer real-time market data, such as price-only feed or a combination of price and volume.
What Does a Crypto Bot Do?
Technical analysis crypto bots are primarily chart-based, using a combination of technical indicators to predict future movements in the price of assets. They can be used for investment analysis, to identify trading opportunities, or to predict future market movements.
Fundamental analysis bots, on the other hand, rely heavily on historical data to draw conclusions about the state of the market and make buy or sell recommendations based on that information. They can be used for trading recommendations, to identify investment opportunities, or to help you decide where to take your money.
Technical analysis crypto bots can be used for almost any type of cryptocurrency, but they are particularly useful when trading cryptocurrency assets that are less volatile, such as Ethereum or Bitcoin.
Fundamental analysis bots are generally better suited for trading assets that are more volatile, such as Ripple, Litecoin, or Bitcoin Cash.
Types of Cryptocurrency Bots
Technical analysis bots can be divided into three categories based on the way theyâre programmed to analyze data: rules-based bots, neural network bots, and evolutionary trading bots. Rules-based bots rely on a set of rules to determine the direction of the asset. They donât use real-time data to analyze the state of the market; instead, they use historical data to make buy or sell decisions.
Neural network bots, on the other hand, use artificial intelligence to âlearnâ from historical market data and use that information to make future trading decisions. Neural network bots can be set up to analyze the market in real-time, though they arenât as prevalent as rules-based bots.
Evolutionary trading bots, the most innovative group, use an evolutionary algorithm to determine the best trades. They use a mix of technical analysis, fundamental analysis, and real-time market data to make investment decisions.
How to Choose the Right Crypto Bot for You
Before you jump into setting up a bot, you should first decide which type is best for you. Once you have that sorted out, you can start looking at the different bots available and see which one meets your needs.
Here are some factors to keep in mind when choosing a bot: Trading Strategy – Make sure the bot you choose supports your trading strategy. If youâre looking for a bot that can handle all aspects of trading, from buy/sell signals to charting tools, you may want to look into a hybrid bot that offers both technical and fundamental analysis.
Investment philosophy – Are you mainly interested in making short-term trades or do you have the luxury of waiting a bit longer to see larger profits? If the former, a rules-based bot might be best for you. If the latter, a neural network bot may be more your style.
Your level of experience – It can be tempting to go with the bot that claims to be âfully functionalâ right off the bat, but you should beware of doing so. New traders especially should be careful about rushing into complex bots that attempt to do too much at once.
Type of exchange – Choosing the right bot for trading on a particular exchange can be tricky. Since each exchange has its own rules and guidelines, itâs best to double-check with the exchangeâs support team to make sure the bot youâre interested in is legit.
Best Crypto Bots for 2022 (Exchange by Exchange)
Here are some of the top bots currently available for trading cryptocurrencies:
Binance Trading Bot – This is one of the most popular bots for good reason. It provides a ton of functionality for both technical and fundamental analysis, including support for a variety of trading pairs, real-time market data, and social media interaction.
Bitmex – This is one of the original Bitcoin trading bots. Itâs a great option for more experienced traders who want a high level of control over their trading decisions. It provides advanced charting, trading signals, margin trading, and even has a âdebuggingâ mode that lets you view the code that drives the bot.
Cryptomate – This bot is a great place to start if youâre looking for a straightforward rules-based bot with a variety of supported trading pairs. It doesnât offer quite as many features as some of the other bots on this list, but itâs easy to use and provides excellent support.
Polybot – Our very own crypto sniper bot is arguably one of the best bots on the market right now as it offers a comprehensive solution for investors looking for the best price entries on 22 blockchains and over 40 DEX.
How Much Does a Crypto Bot Cost?
Cryptocurrency trading bots are becoming more and more popular, but how much should you expect to pay for one? A lot of people are using them to make money and thereâs no doubt that they can be very profitable. However, there is a cost associated with using these bots.
The cost of a trading bot depends on the features that you need. For example, some bots allow you to backtest your strategies, while others offer more features like stop losses and trailing stops. The price for these features ranges from $5 to $100 per month.
The cost of a crypto trading bot varies depending on the features you require. Some bots are free, others charge a monthly fee, and some charge a commission on each trade that the bot executes. The most expensive bots can cost up to $1,000 per month.
A sniper bot can cost anything from $500 to $2,000 depending on the number of features available.
However, there is no guarantee that all cryptocurrency bots will make a profit. In fact, some bots may even lose money for their users. It is important to do your research before choosing a bot and to be prepared to lose money if things go wrong.
