Tips to get started in automated trading with a crypto trading bot
More and more traders are using automated trading, whether in Forex trading, regular stocks, but also for Bitcoin and cryptocurrenciy trading.
80% of trading on the financial markets would be done with trading bots who place orders automatically according to the trading strategies programmed by traders.
The novice trading public is also increasingly interested in automated Bitcoin trading thanks to new automated crypto trading platforms like Kryll, Cryptohopper or 3commas which have a marketplace where traders can rent their trading signals and their strategies to other users.
Social trading and copy trading are booming and allow you to benefit from the skills of professional traders when you are a beginner trader or if you just do not have time to configure a crypto bot or a Bitcoin robot.
We will see how to get started in automated Bitcoin and cryptocurrency trading, the best tips to get started in automated crypto trading, the best crypto trading bots to use as well as crypto exchanges suitable for automated crypto trading.
1. Choose a good crypto exchange
The first step is to open an account on a crypto exchange on which crypto bots and Bitcoin robots will automatically place buy or sell orders for you.
You must therefore have an account on a crypto exchange where you can trade Bitcoin, Ethereum, Ripple XRP or any other crypto currency with which you want to trade automatically.
Once your account is open on one of these crypto exchanges, you can connect it to your crypto bot or Bitcoin robot using an API key that will allow the robot to access your account to place automated trading orders.
The API key allows the trading robot to place orders for you, but no one can withdraw your funds from this account.
It’s just a communication tool between the trading robot and your crypto account.
We are going to recommend two crypto trading platforms which are for us the best on the market and best suited for automated crypto trading.
Due to the number of cryptocurrencies available on this crypto exchange and its low fees, Binance is currently the world leader in crypto exchanges.
Whether trading Bitcoin, Ethereum, Ripple, or other lesser known altcoins like Link, Raven, etc., Binance offers the largest and most diverse offer in cryptocurrencies.
The interface is very well done, easy to use, available in English and many other languages.
The mobile application on iOS and Android is great.
Just open a free account and deposit or buy Bitcoin and cryptocurrencies directly on the platform by credit card for example.
Open a free account on Binance: click here
Kraken crypto exchange has been around for years and one of the best crypto exchanges on the market because it allows to make wire transfers in euros, dollars, british pound, Yen to buy or sell Bitcoin and cryptocurrencies.
Kraken offers the main cryptocurrencies on the market such as Bitcoin BTC, Ethereum, Ripple, Tezos, Link, etc.
The advantage is therefore the bank transfer option and the possibility of selling its cryptocurrencies directly in euros or dollars via automated trading.
It also has a mobile app on iOS and Android.
Just open a free account on Kraken: click here.
Of course, it is possible to use other crypto exchanges where you could have an already open account like Coinbase, Kucoin, Bittrex, Hitbtc, etc.
It will then be necessary to check whether the crypto bots platform that you want to use has integrated the crypto exchange where you have opened an account.
2. Choose a good crypto trading bot or Bitcoin robot
To start and succeed in automated crypto trading, you must of course choose the best crypto bot and Bitcoin robot on the market.
You can see our guide with the best crypto trading bots 2020: click here.
For a beginner in trading and more particularly in Bitcoin and cryptocurrency trading, the best automated crypto trading platform is Kryll.
kryll offers professional crypto trading bots and Bitcoin robots in english, Spanish and french.
It offers a professional technical support, guides and tutorials free of charge to users and novice traders to learn automated cryptocurrency trading.
A drag and drop graphical interface is available to build and create your trading strategies by gradually assembling them in blocks.
Tools and indicators are available (Smart trading, stop loss, take profit, Ichimoku, Bollinger, Macd, RSI, CandleStick blocks and Candlestick Patterns, Grid trading,…).
Another important element for a beginner in trading, testing and backtesting of trading strategies is free and unlimited on Kryll!
You can do as many test simulations for free, once you are ready, you can go into real mode on the crypto markets.
There is no monthly subscription, you only pay when you use the crypto trading bots and Bitcoin robots.
The cost of using crypto bots is therefore much cheaper than competing crypto bots which require a monthly subscription which varies depending on the options used.
On Kryll, you have access to all crypto services and bots by paying only per use.
A mobile application on iOS and Android is also available to track your crypto bots in real time.
Another important element, the Kryll marketplace
Social trading and copy trading are increasingly used by novice traders who want to learn by observing the trading strategies of professional traders.
Kryll has a marketplace where professional traders can rent their trading signals or crypto trading strategies.
Thus, a beginner trader or someone without knowledge in trading can therefore use the skills of a professional trader by using the strategies of a professional trader.
This allows you to learn trading by observing the operation of professional traders’ strategies.
Everything is automatically copied to your account, the kryll crypto bots and Bitcoin robots will place the sell and buy orders programmed in the trading strategy that you rent to another trader on the platform.
Professional traders who do not have the time also use this option which therefore saves time with an already made and proven trading strategy.
The trader who rents his trading strategies can generate a passive income and earn money thanks to his skills appreciated by other users of the platform.
Just create a free account on Kryll: click here.
A very well known professional automated crypto trading platform on the market.
A good platform for beginners in crypto trading, Cryptohopper offers guides and tutorials to learn about crypto trading.
A drag and drop interface to build crypto trading strategies, their crypto trading bots and Bitcoin robots are only available in english.
A mobile application on iOS and android to keep track of your trades in real time.
Cryptohopper also has a marketplace to use trading signals and trading stratégies from professional traders on the platform.
There is a 7 day free trial available, just open an account to try their crypto trading bots: click here.
Another automated crypto trading platform known for its crypto bots but which is less suitable for novice traders and beginners.
3commas is available in english and different languages like russian, french, … which makes it easier to use its Bitcoin robots and crypto bots if english is not your native mother tongue.
One of the advantages of 3commas Bitcoin robots is that they can operate with 23 different crypto exchanges.
Binance, Binance US, Binance DEX, Binance Jersey, Kraken, Bitfinex, Bitmex, Bitstamp, Bittrex, Bybit, Bybit Testnet, CEX, Ethereum Wallet, Exmo, Gate.io, Coinbase Pro, Hitbtc, Huobi, Huobi US, Kraken, Kucoin , OKex, Poloniex, Yobit.
The interface also works in drag and drop mode to create your trading strategies.
The platform also has a marketplace where it is possible to buy trading signals from professional traders.
An iOS and Android mobile app is available to track your automatic trading and crypto bots.
A free 3-day trial is offered otherwise you have to pay a monthly subscription in order to access the 3commas Bitcoin robots.
Open a free account on 3commas to test its crypto trading bots: click here.
There are other crypto bots and Bitcoin trading robots on the market, read our ultimate guide with the best crypto trading bots 2020: click here
3. Set up a crypto trading bot / Bitcoin robot
Once registered on an automated crypto trading platform, you will therefore be able to use their crypto bots and Bitcoin robots to do automated crypto trading.
Create a crypto trading strategy
As seen above, you can create your own trading strategies and do automatic trading with Bitcoin, Ethereum, Ripple or any other cryptocurrency available on crypto exchanges integrated on the automated crypto trading platform that you will use (Kryll, 3commas, Cryptohopper, etc.).
In drag and drop mode, you will be able to create your trading strategies as in the photo above which is the graphical interface on Kryll.
You will have all the tools necessary to create your strategies, indicators, candle models, (stop loss, take profit, smart trading, bollinger, RSI, macd, arbitrage, etc.).
Some of these platforms offer free tutorials, guides and videos for training in automatic trading and technical analysis.
You must then test your strategies before going into real mode if the automated crypto trading platform allows you to do so. (Kryll allows you to do as many tests as you want and for free)
Copy trading and social trading
If you don’t want to create a trading strategy because you don’t have the skills yet or just don’t have the time, then you can do copy trading or social trading using the trading strategies of professional traders.
You just need to choose a trading strategy or trading signals that you want to use on the markeplaces provided by these automated trading platforms.
The Bitcoin and crypto trading robots will copy the sell and buy orders programmed by the pro traders you want to copy to your account.
This allows you to observe the trading strategies of professional traders in order to learn how they do crypto trading.
Connect your crypto bot to your account on a crypto exchange
You will connect your account on a crypto exchange like Binance to the automated crypto trading platform using an API key.
These platforms show you how to do it step by step on their interface.
Once crypto bots have access to your account, you will be able to do automated cryptocurrency trading.
4. Test your crypto bot
Getting started in trading means training before going into real mode.
Do backtesting and live testing as much as you need until you are ready to go into real mode.
Backtesting allows you to execute strategies on historical price data.
Live testing allows you to simulate a strategy in the live market.
Most automated trading platforms allow backtesting, and many offer live testing.
Platforms like Kryll offer technical support to help you get started in automated crypto trading with crypto bots.
Test each trading strategy you think you want to use.
Keep in mind that backtesting is only a test of what would have happened in the past, not what will happen in the future, the live test is only a test for the moment, it doesn’t test the future either.
Each cryptocurrency has a price that evolves in a specific way, the Bitcoin price goes up or down in a different way than a less known altcoin.
In the event of a fall in the BTC price, the price of altcoins could drop much more significantly, for example.
In addition, some altcoins have very little volume, it can be difficult to sell your tokens quickly if it was necessary in the event of a fall in price.
Do not forget that going into real mode on the financial markets implies that you are putting at stake the capital that you have invested in your crypto trading strategies.
So, expect losses that are part of the trading business, the goal being to make more profits than losses.
5. Risk management in crypto trading
Do not put all your eggs in the same basket, this well-known expression applies to trading.
“Diversification serves to protect from ignorance. If you don’t want to have unpleasant surprises, buy the whole market.” said Warren Buffett.
In trading, a trader will have gains and losses, so spread the risks to minimize the effects of losses when you get them.
Start trading automatically with small amounts, if you have losses, they will not have a significant impact on your capital.
You can think of this as a cost of learning to trade that allows you to learn in real mode.
Do not forget to put a stop loss if the price of the cryptocurrency with which you trade automatically drops.
The stop loss will sell your cryptocurrency if its price drops to a certain level that you deem critical and seems better to sell.
Create or use multiple trading strategies on different cryptocurrencies to spread risk.
Depending on the period, certain strategies (bear market or bull market for example) or cryptocurrencies will work better than others.
By spreading your capital across different strategies and cryptocurrencies, you reduce the risk of betting all of your capital on a single trading strategy for a particular cryptocurrency.
Have patience, this is one of the main rules for success in trading.
As Warren Buffett puts it: “The stock market is a way to transfer money from the impatient to the patient”
Cycles can be long on the stock market, so be sure to wait for the best times to buy or sell Bitcoin or other cryptocurrencies.
An automatic trading strategy may therefore take time before triggering or producing interesting results.
One of the big advantages of crypto bots and Bitcoin robots is that you delegate your emotions or your impatience to the trading robot that will manage trading for you.
So there you have tips and advice on how to get started in automatic trading of Bitcoin and cryptocurrency.
Take the time to choose on which crypto exchange you will open your account that will store your Bitcoins and cryptocurrencies.
Same thing for crypto bots and Bitcoin robots, take time to choose the automated crypto trading platform you are going to use.
Sign up on several platforms, see which one best meets your expectations according to the options and prices offered for its crypto bots.
See our review of the best crypto trading bots 2020: click here.
Be patient when learning, test the crypto bots before going into real mode in order to responsibly manage the money you will invest in automated cryptocurrency trading.