A trading bot is only as good as its strategy. It removes emotion and executes 24/7, but it can't tell you which direction the market is going. Here are the three main types and how they work.
A grid bot places buy and sell orders at set price intervals within a range. It profits from volatility without needing a trend — ideal for choppy, range-bound markets like most altcoins in a bull market plateau.
A DCA bot buys a fixed amount at fixed intervals (daily, weekly) regardless of price. It removes the temptation to time the market and smooths out your average entry price over months.
These bots exploit price differences for the same asset across exchanges, buying low on one and selling high on another in seconds. Margins are small (0.1-0.5%) but can compound with volume and speed.
No bot beats a bad market condition or bad strategy. Backtest before deploying real capital, start with small amounts, and never trust a bot with money you can't afford to lose to a bug or an unexpected crash.
Read More →