In a world of online financial markets trading, certain techniques allow those with less skill to access the market and make profits. The technique is known as automated trading and is very popular among day traders on currency, crypto, stocks, and other markets. What does this technique entail?
Automated trading is a technique that partially or totally automates entry and exit positions on the financial markets. With automatic trading, all buying and selling operations are carried out by a program. However, the trader must define the parameters of his trading strategy after careful technical analysis.
What is Automated Trading Software?
Trading software, such as BitBotApp, is a computer program that allows orders to be given automatically based on the various signals of financial market trends. This trading tool, also called a trading robot, makes it possible to carry out transactions instead of the trader.
Trading software relies on technical analysis of the market to make decisions. The best part is that treaders don’t have to do tech analysis to find the best opportunities.
The software does everything. Some of these tools boast several asset classes for trading. And there are those focusing only on the market. BitBotApp, to take one of the best on the market for an example, boasts more than 15000 coins and is primarily focused on the crypto market.
Auto trading software relies completely on algorithms, machine learning, and AI systems incorporated within. Their main advantage is the traders don’t have to monitor the market constantly to make trades, and also they exclude the emotional aspect of trading, which is so harmful to trading outcomes.
How does Automated Trading work?
- Choosing a Platform for Automated Trading
- Define the parameters of your trading strategy (take profit, stop loss, etc.)
- Set up a set of rules and conditions to be followed by the algorithm
- Launch the custom algorithm and let it analyze the market and place trades for you
What are the Types of Automatic Trading?
Automated trading: the trading software has total autonomy over the trader’s investment. It is up to him to decide whether to open and close positions, calculate the risk/return ratio, define the size of positions, etc. The trader is completely inactive once he has set up the program.
Assisted or semi-automatic trading: once the trading robot has analyzed the markets according to the parameters indicated by the trader, it provides alerts to the trader, who can then place an order or not. Assisted trading or semi-automatic trading can also consist of the trading software simply managing the positions opened by the trader
What Assets Can You Auto Trade?
With an automated trading system, you can trade any asset from currencies, ETFs, commodities, and cryptocurrencies. Some tools cover several asset classes, and there are also those that focus on one asset. BitBotApp, for instance, is an exclusively crypto trading bot boasting more than half a million clients so far.
Who can do Automated Trading?
Automated trading is suitable for novice traders as well as intermediate and professional traders. Since the use of trading software does not require any special knowledge, even novices can use it. Professionals most often use it to test their strategy. Independent traders and even financial institutions that own trading robots can also do automatic trading.