What and Why On ​Crypto Trading Robots

Trading cryptocurrency is similar to trading on any other financial trading in the sense that in order to be successful you will need knowledge which is achieved with time and experience. Knowledge includes understanding of the market and being up to date with its shifts, and consequently – their effect (or possible effects) on your trading.

Trading also has a psychological element which can sometimes hinder making “clean” decisions which are detached from subjective feelings..

Crypto trading robots – also referred to as crypto trading software – are autonomous
computer programs which use technical indicators analysed by mathematical algorithms to generate trading signals. Those signals are meant to assist in decision making when it comes to buying or selling cryptocurrency.

Or in plain words – Trading robots are a software that makes the trading decisions and actual trades for you, with a higher success rate of profitable trades than most human traders.

It is important to understand that crypto trading robots, despite their considerable capabilities, are not meant to replace the trader, but only assist in the market analysis and decision-making process.

 

There are many crypto trading robots, and like any other software – some are better than others and sometimes it is just a question of finding the right fit.

Crypto trading robots are available through online brokers who provide them as a service to their clients, to assist in managing their trading endeavours and cryptocurrency accounts.


Such software are also available from third parties instead (or as an addition) to the broker- provided software.

Why Crypto Trading Robots​

Crypto trading robots are programmed to retrieve market information and make trading
decisions based on their analysis and according to pre-set parameters. This enables the
robots to enter or exit trades and place buy or sell orders when certain conditions, as set by the trader, are met.

 

Crypto trading software is meant to assist in data analysis, decision making, recognize
opportunities and thus maximize profitability. 
As these are autonomous online services, they work for the trader basically non-stop, year-
round.

 

Once you understand how crypto trading robots operate and the benefit of using such
software, you will also understand that they are beneficial to any trader, no matter their level
of experience.

Pros​ and Cons of Crypto Trading Robots

Pros

  • The main advantage of crypto trading robots is their ability to efficiently collect and process large volume of real time data and quickly place trade orders accordingly.
  • Furthermore, as robots are making trade decisions based on mathematical algorithms, they are operating on logic - clear of human emotions. This means that crypto trading robots, by default, are much more accurate than human traders and are better able to execute a larger percentage of profitable trades.
  • The software has a backtesting option which applies the settings to recent historical market conditions, to determine if the current settings of the algorithm would result in profit. Adjustments to the settings can be done accordingly.
  • Trader’s preferences are precisely followed in the execution of cryptocurrency trades.
  • Crypto trading software can handle everything for you, from the moment you make your first deposit. You can basically just let it run and withdraw your profits.
  • The software allows the trader to manage multiple accounts.
  • If you are uncertain of trusting automated software, most reputable software will provide live support.

Cons

  • Currency trading can be complicated and understanding it can be difficult, especially for those who are unfamiliar with the market and inexperienced in trading.
    This is especially true to the cryptocurrency trading market, as it is unregulated and prone to scams and therefore to the possibility of loss.
  • crypto trading robots are not failproof. Trading carries risks in any manner, whether manually or automated, and even the leading crypto trading robots can sometimes lose on a trade.
  • Functionality and results monitoring is highly recommended.
  • Technical failure might occur, as with any other software.

How Crypto Trading Robots Work

Crypto trading software nowadays are available to almost anyone, and by definition they are supposed to make trading much easier, efficient and profitable. There are many types available, and they may be very similar or differ by cost, features, options, and advantages. 
The trading robots are similar in the way they analyse the market and execute trading transactions. They retrieve relevant market data and process it in real time, analysing it according to pre-set algorithms. When certain predetermined conditions are met, an action is triggered to either enter or exit a trade.
The conditions which are set to trigger an action can be programmed in many cryptocurrency trading software. This is a desirable feature, as it allows the trader to set the parameters according to personal preferences, available crypto capital, and risk levels.

When parameters are set and conditions are met, this is when the crypto trading software enter into action for selling or buying. Using an automated software allows the trader to not miss any opportunity to trade when conditions are right. 

Using Crypto Trading Robots

It is important to understand that results are never guaranteed. As accurate, complicated and advanced those robots are, any financial market is subjected to sudden shift which might impact the outcome or even execution of a trade. It is a huge advantage of crypto trading robots to be able to analyse the market in real time and execute trade transaction very quickly, as it limits to minimum the possible effects of unanticipated changes in the market.

 

When choosing a crypto trading robot, it is important to compare the options and preferably choose one which allows manual and automated trading, along with the option to adjust the default software settings to meet your own preferences. These options will ensure you have the best control over your crypto trading.

 

Because the trading robots are designed to make decisions based on specific pre-set rules, it means that there is no outer influence, or second guessing caused by human emotions. No unnecessary risks nor cautious hesitations – the robots act by a precise data analysis and according to the trader’s rules.

 

Given those rules, another important feature of automated crypto trading software is backtesting. Backtesting means that the software applies the set trading strategy to historical market data, in order to test how accurately it would have predicted the actual results. 
This is what enables you to test your settings of the trading robot, to make sure you are likely to succeed with your trading. 

Choosing the Right Trading Robot For you

The choice of crypto trading robot should start with deciding what you would like to trade.

Other than comparing the different options offered by every software – such as pre-set plan, features, backtesting, cost and fees, support – the decision of what you would concentrate your trading on, or rather – how much you would like to explore, is a key to making the right choice. As with anything else, focus helps in making the right choices and eventually – in achieving your goals.

 

The differentiation should be not only between good and better robots, but also between the legit to the scam. Being an unregulated market makes it easier for scammers to cheat traders out of their hard-earned money.

 

To help you make an educated choice, we have gathered all the information into comprehensive reviews of the leading crypto trading robots and also put together a list of the top 5 trading robots for your convenience.