Purchasing Bitcoin years ago has led many people into a better financial situation than they expected. People getting into the cryptocurrency ecosystem now are also hoping for the same parabolic growth, but not everyone has disposable income to consistently invest into their cryptocurrencies, so most people try their hands at trading. The main complaint people about actively trading is that there is a learning curve, and it’s also time consuming. This is when the question of “Can a crypto trading bot really generate money” appears. Thankfully, the answer is and has been, yes. Automated trading can trade 24 hours a day, making you money while you sleep, and it can also monitor market conditions that fluctuate in ways that you might not notice.
Table of Contents
1. Step One – HODLing can backfire
2. Step Two – Day trading is expensive
3. Step Three – Emotional attachment can lead to losses
4. Step Four – Scalp trading with a trading bot
5. Step Five – Learning to trade through a trading bot
1. Step One – HODLing can backfireWhen I first got into Bitcoin and learned how to trade on various exchanges, I ended up investing in some coins that ended up losing value as others gained traction. While reading forum post from other people that were in similar situations, I came across the term “HODL”. If you are unfamiliar with this expression, it means to hold on for dear life. While this concept seemed quaint enough, when I realized the amount of money, I ended up losing became a bit overwhelming, especially when I took into consideration what would have happened if I had sold at a minor loss and then resituated those funds into a coin that had long-term growth. So, while the expression may have deep rooted history within the crypto realm, it might not be the best trading strategy for you.
2. Step Two –Day trading is expensiveDay trading became a big part of my life for a couple of years, especially as the market was progressing in a meteoric way. A lot of people have spent years taking classes, buying books and studying in private support chats in hopes of gaining an edge, but this can become expensive really quickly and there is no guarantee that this will result in any profitable trades. Also, the learning curve of going from a complete newbie to a proficient trader is time intensive, meaning a ton of sleepless nights staring at screens and watching charts while still possibly losing money. There are professional traders that have also became involved within the cryptocurrency realm, so trying to out maneuver professionals can at times work, but it’s going to be a huge uphill battle. Also, there are entities known as whales, which are people with vast resources that use their deep pockets to manipulate prices, and trying to decipher their movements within a particular trading pair can lead to some losing a lot of their investment as they panic sell, or try to chase a skyrocketing asset.
3. Step Three –Emotional attachment can lead to lossesAnytime money is at risk, people will become emotional, it’s just basic human biology to want to protect our finite resources. This can lead to a lot of bad times while trading, as seeing an asset plummet due to some rumors of upcoming bad news can shake even the most resilient of traders. Panic selling can sometimes save the day, but usually it results in some seller’s remorse as if a coin was manipulated, it will most likely bounce back when you least expect it. On the reverse side, watching a coin gain value suddenly, and hoping to catch it on the up-swing is a common trap that a lot of new traders fall for. Sometimes people can group together and pump a coin, intentionally misleading people into jumping in and also purchasing the asset of that coin, just so that they can then sell their huge quantities of that coin for huge profits, leaving unaware traders with huge bags of what could end up being a pretty valueless coin. Turning off emotions and using just fundamentals is something a lot of traders strive to, but the human condition is inescapable, so that is the main feature of why a trading bot is able to generate money.
Crypto trading bots generate money due to numerous factors, such as being able to run 24 hours a day, 7 days a week. Also, the bots have no emotions to cloud judgement, as automated cryptocurrency trading bots run of off algorithms that you configure to reflect your particular trading style. A lot of new traders that are trying to actively trade using the Gunbot automated trading bot use the Emotionless trading strategy, as it is a strategy dedicated to ease of use and consistent, small trades. As soon as a coin moves slightly downwards, against its usual trajectory, the Emotionless trading strategy will place an order as long as it’s gone down 1 percent (though you can modify this) and will sell as soon as the coin has gained ½ percent of profit (also a setting you can change). The likelihood of a trader being able to configure this exact strategy by hand for any and every coin they are interested in trading is rather minimal, but with Gunbot, you can do this in about 5 minutes of data entry.
4. Step Four –Scalp trading with a trading bot
1. 5. Step Five – Learning to trade through a trading bot
An unexpected yet positive result of trading with an automated bot is that you will inadvertently pick up better trading habits, as well as have a better understanding of trading strategies. By being able to change your settings with minimal effort, you can see how changing a percentage here or there will change the amount of trades that occur, as well as your profit margins. Instead of profits being an abstract idea, you will be able to see profit percentages, as well as BTC and USD gains within a click of a button. Gunbot has a wide variety of trading strategies available and with the amount of personalization also available, your possibilities become near endless. You can use a conservative strategy on a coin with relatively steady movement and make small gains, while also using a strategy that will lower the overall cost of coins that you have that might have lost a significant amount of value, with little to no experience in configuring stop-limits or market buys. By seeing profits stacking up, you can slowly but surely gain confidence in your trading experiences, as well as find comfort in being able to minimize risk you undertake by deciding what percentage of loss is acceptable for you. As your trades take place, you can learn through experience how market sentiment affects trading volume and possible profits, as well as valuation. All of the knowledge that you gain will be valuable and applicable to even manual trades if you decide to trade on an exchange that you choose not to use an automated trading on, so being able to transfer that knowledge is really useful, especially if you are trying to explain to a friend or co-worker why they should also possibly take a similar position on a trade.
In summary, to the question of “can a crypto trading bot really generate money”, with a small bit of attentiveness and a steady internet connection, the answer is yes. Trying to HODL in hopes for better days can be a heavy burden and end up in a consistent devaluation of a coin you invest in. Day trading can be very time consuming, yet at times not as rewarding as even a minimum-wage job, regardless of the amount of time you invest into it. Emotional entanglement with your investments can lead you chasing green candles and ending up with heavy bags repeatedly, so removing that risk by trading with something like the Gunbot trading bot can give you more free time, as well as maximize your overall profitability. Do you have any moments where you wish you had not adhered to the motto of “HODL”? Have you ever had an emotional reaction result in losing a large amount of investment? Leave your stories in the comments below.