Of all the popular cryptocurrency exchanges, KuCoin has rapidly set itself apart due to offering its very own automated trading bots free of charge. As an innovative and unique step from a major exchange, this approach has put KuCoin right on top of the list of those cryptocurrency users who rely upon automated trading but don’t want to pay sky-high prices for standalone bot applications.
If you are new to the concept of using KuCoin trading bots instead of third-party solutions, you are not alone. Many traders who rely on third-party bots are warming up to the idea of using KuCoin bots instead. With several strategies, easy interface, and optimal functionally, the approach also pays off for many of these traders.
To help you join this growing community with the utmost ease, here are the best tips for using KuCoin trading bots in order to make automated, effective, and profitable trades for your digital assets. You can also check my KuCoin bot results to get a better idea of the whole process.
🤖 Launch As Many Bots As Possible
With KuCoin trading bots, you can launch bots including Spot Grid, Futures Grid, Smart Rebalance, and DCA. The first three bots are easily available on the web platform, while the DCA feature is only available through the KuCoin app.
Since KuCoin bots are totally free, they provide you with a cost-saving benefit that perhaps no other functional bot of the same class brings to the table. In order to make the most out of this advantage, you should make it a point to create and launch as many bots as possible on the platform.
In addition to letting you use multiple bots free of cost, this approach also diversifies your trading strategies. When you don’t put all your eggs in one basket, it also pays off in terms of preventing larger risks and maximizing your chances for profit.
This way, if a certain bot or strategy is not working for you, you can easily switch to another one. In case you run simultaneous bots, this could help you benefit from the market in more than one way.
With that being said, it is important to understand that KuCoin’s free trading bots come with a certain limit per trading account. This does not mean that the bots are not free. It just translates to a fair usage policy by the exchange to ensure that no one is taking unfair advantage of the value added service of free trading bots.
The current limit is up to 10 bots per trading user. But this could be increased in the future. However, as you turn towards this tip, you should also remember that this approach may require you to invest more funds into the exchange. Due to this reason, it is advised that you use this practice with caution and only with funds that you can afford to lose in case of volatile pricing movements.
📉 Do Not Start Spot Bots When the Market is Falling
It is a cardinal rule of utilizing automated spot trading bots that you should never use them when the market is falling. It is because when the market price for an asset is trickling down, it exposes you to unnecessary risk and puts you in a position where you could lose money pretty significantly pretty fast. In turn, this approach causes you to be more at risk with every passing moment.
In order to avoid this risk, remember to launch your KuCoin trading bot when the market is moving upwards or sideways. This ensures that you are able to capitalize on market movements with as minimal of a risk as possible.
Determining this factor is not difficult at all. You simply need to look at the market and associated trends. From there, you can easily see if the market is moving sideways or shows signs of an increase in its pricing or activity. Once you are sure about the market’s condition, you can launch your KuCoin bot and let it do its magic.
At the same time, you need to ensure that you are keeping a close eye on the bot’s overall movements. If your newly launched bot gets caught in a falling market, it is best to pause or pull it for at least a few hours. This once again lowers your margin for loss and allows you to continue making your trades through a potentially profitable approach.
While this approach requires you to be more in line with monitoring and managing your bots on an active basis, doing so for the first few days pays off in the long run. For one, it ensures that you can manage any surprises that you might face in a new market. Secondly, it lets you understand what kind of movements to expect on an average basis.
As a result, you can steer clear of sudden shocks and prevent larger risks of losing money just because you invested in a market without doing your research. Due to this reason, this practice is a must-follow for traders who want to use KuCoin trading bots on the spot markets.
📊 Use BTC as Quote Currency
When you are managing your trades through any kind of trading bots, you have multiple options in terms of using base and quote currencies. This also holds true for KuCoin bots, where you can choose between Bitcoin (BTC) and Tether (USDT) trading pairs in combination with your desired cryptocurrency or token.
For instance, if you want to trade Ether (ETH), you can easily choose the trading pair of ETH/BTC or ETH/USDT. The first pair lets you manage your cryptocurrency trades through Bitcoin, which is the epitome of digital assets. Whereas, the latter pair allows you to manage your trades using USDT, which is a stablecoin that has its value tied with USD.
But in order to make the most out of your trading activities, you should look into using BTC as your quote currency instead of USDT. There are several reasons for that.
First, having BTC as your quote currency allows you to have some of this digital asset at hand at all times, and diversifies your portfolio beyond a stablecoin. Furthermore, given that BTC continues to increase in value overtime, this also allows you to see your investment grow on its own.
This approach also works in cases where your bot tends to overbuy the quote currency. Since it won’t just be purchasing a stablecoin for the sake of conversion but a high demand cryptocurrency that actually flourishes in value, this also helps you contribute to the growth of your investment overtime.
This approach is largely related to BTC. But you can also follow it with other high value cryptocurrencies as you see fit. At the same time, if you do not want to take a risk with market fluctuations, you can still go with using USDT as your quote currency. By considering all options and making an informed decision, you can use a strategy that is comfortable for your trading style.
💰 Go With a 0.5% Profit per Grid Setting
KuCoin trading bots allow you to launch grid bots with profit per grid parameters. This provides you with a way to control the frequency of your trades and lets you sell specific digital assets from your portfolio quickly whenever they have reached a certain increase in their price.
Whenever you set up your KuCoin grid bot, consider setting up your profit per grid parameter to be ~0.5 percent. This figure is sufficient enough to execute your trades in a frequent way. At the same time, this lets you benefit from your profits in a way that they could cover your exchange fees.
This also has a direct impact on your overall profits and allows you to see extra income in a more consistent manner. This phenomenon depends on market conditions, which means that you cannot always expect remarkable results at every step. But in many cases, it turns out to be highly profitable for your trading strategy and the bots that you set up.
To help you understand this in a more detailed way, your profit per grid parameter basically outlines the contrast between each of your buy order and sell order on grid trading. When you set up the parameter, it determines the difference that your buy orders and your new sell orders could follow between each new order.
By setting up your profit per grid parameter to be ~0.5 percent, you can open doors to trades being executed at higher frequency and with a chance of higher profits. While the actual mechanics and results of this approach depend on market conditions, practicing it can provide you with a chance to nab higher profits.
This means that as you move forward with executing this practice, you should make it a point to be vigilant of its results. After the first few days of constant monitoring, you can decide whether the strategy is working as well for you as you had expected.
🔁 Relaunch Your Bots When Needed
The concept of setting up an automated trading bot is all about bringing ease of use and convenience to your life. Instead of being glued to your screen 24/7, these solutions allow you to make trades in your absence. Even when you have to monitor them during the first few days of setup, they allow you to kick back and relax while they make trades on your behalf.
This also holds true for KuCoin’s trading bots. With that being said, it calls for you to look through the maintenance of these trading bots from time to time. This especially applies to situations where your bots stop working due to running out of range of your set price.
This particular scenario is not worrisome. It simply means that the trading range you set up for your bot no longer applies to the market. When this happens, your bots halt their functions to stop making trades with prices that are not pre-approved by your end.
You need to stop and relaunch your bots if the price went out of the trading range. You can simply close the bot if the price went out from the upper range and relaunch with a new trading range if it went out from the lower side.)
💸 Free Solutions Are Present but Professionals Use Paid Options
It is critically important to realize that Kucoin bots are free to use and you can start your journey by using their internal bot solution. But if you want to become a more professional trader, then you need to think about buying a subscription for the third-party paid bot solution. These solutions have more settings and features and can bring a more stable profit.
If you are looking to genuinely gain quite a bit of value in the cryptocurrency market, then you want to make sure to approach it in a professional way. Sure, many people have gotten lucky by merely holding a few of these critical assets. The luck was that they were aware of these decentralized assets and were living in an era when blockchain and cryptocurrencies really came to the forefront. Then, having the wherewithal to purchase these assets without having to worry about the initial risks present within the market.
Now, the truth is that as the digital asset market matures, you will need to become more active. You can gain wealth over a longer time horizon by merely holding the assets. But if you have a shorter time horizon, you will note that it is essential to conduct shorter-term trading.
This will enable you to gain quite a bit of value if you know what you are doing. It is here where you will want to learn how to use your automated application to provide you with the right returns.
If you are able to apply discipline, commitment, patience, and a moderate amount of diligence, then you can see your net worth grow over time as the cryptocurrency market grows as well.
The key is to stick with it, to invest in yourself and to make sure to invest in the right tools that will pay off over time.