Resolve common problems related to DCA bot trading.

DCA bot.svg

<p>Profit currency is an essential aspect of your trading setup, but it is often misunderstood. In this article, we explain how a bot can profit in quote or base and in which cases you could use them for maximum profit.</p><p>First, let's quickly clarify that trading pairs are usually displayed as <strong>BASE/QUOTE </strong>(for example, BTC/USDT). So when you profit in quote, you accumulate the currency on the right side of the pair (USDT in this example), and when you profit in base, you earn the currency on the left side of the pair (BTC in this case).</p><p>Also, it's important to mention that exchange fees <a href="https://gainium.io/help/are-exchange-fees-excluded-from-profit-calculation">are excluded</a> (accounted for) in profit calculation, so you don't have to worry about that.</p><h2>How does the bot profit in base or quote?</h2><p>Profiting in quote is relatively straightforward; the bot uses the quote to buy the base, and when the base increases in value, it will sell all the base, therefore ending up with more quote than it used to make the original purchase.</p><p>However, profiting in base can be a bit confusing. In this case, the bot uses quote to buy the base, and when the base increases in value, it will sell enough base to recover the quote spent for the original purchase, keeping the rest of the base as the profit.</p><h2>When should you profit in quote or base?</h2><p>As a general rule, if you expect the value of the base to appreciate over time, it is best to profit in base. On the other hand, if the base is already in the all-time-high territory and you expect it to decrease in value in the future, it is best to profit in quote.</p>

In this article we explain how bots can actually profit in quote or in base and when is it best to use each.

Profit in Base and Quote

<p>In Gainium's suite of tools, the 'Smart Orders' feature stands out as a strategic game-changer for traders who wish to maintain liquidity while automating trades. This feature is versatile and can be applied across all bot types: DCA, Grid, and Combo. Here, we break down the concept of Smart Orders and provide a practical example for grid trading with BTC/USDT.</p><h2>What are Smart Orders?</h2><p>Smart Orders are a nuanced approach to automated trading. Instead of sending all the orders as limit orders at once — which would tie up and lock all the funds — Smart Orders allow the bots to send only a portion of these orders. The result? More available funds, ensuring that you maintain liquidity and flexibility in your trading activities.</p><figure class="image"><img src="https://back.gainium.io/uploads/Smart_Orders_Grid_11b13d36f6.jpeg" alt="Smart-Orders-Grid.jpeg"><figcaption>Smart orders in grid bots</figcaption></figure><figure class="image"><img src="https://back.gainium.io/uploads/Smart_Orders_DCA_c59c05b22a.jpeg" alt="Smart-Orders-DCA.jpeg"><figcaption>Smart orders in DCA bots</figcaption></figure><h2>Benefits of Smart Orders</h2><ol><li><strong>Improved Liquidity</strong>: Avoid locking up all your funds in limit orders. With Smart Orders, a significant portion of your funds remain free and accessible.</li><li><strong>Flexibility</strong>: You can use the free funds for other trading strategies or to adjust to market conditions swiftly.</li><li><strong>Optimized Trading</strong>: Especially useful during high market volatility, Smart Orders ensure you don't miss out on potentially profitable trades because your funds are tied up.</li></ol><h2>Example: Grid Trading BTC/USDT with Smart Orders</h2><p>Let's dive into a practical example to understand how Smart Orders can make a difference.</p><p><strong>Without Smart Orders</strong>: Suppose you've allocated 10,000 USDT for grid trading BTC/USDT. You set up 100 grids, which means 100 limit buy and sell orders spread between your desired price range. The system would place all 100 orders simultaneously, locking up the entire 10,000 USDT. You wouldn't be able to use any of these funds until an order gets executed or canceled.</p><p><strong>With Smart Orders</strong>: Using the same scenario with the Smart Orders feature activated, instead of placing all 100 orders, the system might only place 10 orders around the current price. As the price of BTC/USDT moves and an order gets executed, the bot will then place a new order in the next grid. This means a significant portion of your 10,000 USDT remains available and isn't locked in unexecuted orders.</p><h2>How to Set Up Smart Orders</h2><ol><li>Create a New bot</li><li>In grid bots, Smart orders are found in the Budget section. In DCA and Combo bots, they are found in the DCA section</li><li>Configure the number of active orders, meaning, the number of limit orders to keep in the exchange at any given time</li><li>Complete the bot setup and activate it.</li></ol><h2>Conclusion</h2><p>Smart Orders are all about optimizing the automated trading experience. By freeing up funds and offering increased flexibility, Gainium provides traders with a strategic edge, ensuring that they're always ready to capitalize on market opportunities. If you're seeking a more efficient and liquid trading experience, it's time to embrace Smart Orders.</p>

Explore Gainium's 'Smart Orders' feature, designed to enhance liquidity and flexibility in automated trading. Dive into its benefits and learn how it revolutionizes grid trading with BTC/USDT.

Smart Orders

<p>Exchanges fees are excluded from profit calculation for all bots and deals.</p><p>In addition, fee discounts and exceptions are accounted for. When starting a bot, we request the fee directly from the exchange for that particular pair and we discount this fee from all profit calculations.</p>

Users often wonder if exchange fees are excluded from profit calculation. The short answer is yes, read this article to learn more.

Are exchange fees excluded from profit calculation?

<p>If you ever found yourself in the situation where your bot opened many small deals and you wish you could consolidate all of them into a single one for easier management? We have just the feature for you! With the merge deal feature, you can consolidate any deals into a single one, as long as they are on the same exchange and coin pair.</p><h2>What happens when deals are merged?</h2><p>When several deals are merged, their base amount are added and their break-even price are weighted-averaged into a single deal. Only the amount of purchased base (for longs) or sold base (for shorts) are consolidated into a new deal, any pending orders of the original deals will be cancelled.</p><p><strong>Example:</strong></p><p>Suppose we have have two deals</p><ul><li>Deal A: 0.5 BNB that we purchased for 100 BUSD. Break-even price is 200 BUSD/BNB. It has a TP set at 250 BUSD/BNB and SL set at 100 BUSD/BNB.</li><li>Deal B: a DCA deal currently for 1 BNB. 0.5 BNB was purchased for 200 BUSD/BNB and another 0.5 BNB was purchased for 150 BUSD/BNB. It has a pending DCA order for another 0.5BNB at 100 BUSD/BNB. Break-even price is currently 350 BUSD/BNB</li></ul><p>If we decide to merge these two deals, the result would be:</p><ul><li>Deal C: 1.5 BNB purchased for 450 BUSD, current break-even price is 300 BUSD/BNB. The pending TP and SL of deal A as well as the pending DCA order of deal B has been cancelled. We can manually set DCA, TP or SL on this deal if we wish.</li></ul><h2>How can you merge deals?</h2><p>To merge deals simply check the checkbox from the deals list and click on the “Merge Deals” button.</p><p><img src="https://back.gainium.io/uploads/Merge_cdbb634507.webp" alt="Merge.webp"></p><p><strong>NOTE</strong>: If your bot's entry signal is ASAP, merging deals may result in your bot opening new deals right after the merge. To avoid this, either change the entry trigger to something else, or adjust the maximum active deals so that there are no free slots for new deals after the merge.</p>

Lear about the merge deals feature on Gainium.

Merge Deals

<p>The current break-even and final break-even lines are visual aids to help your trading strategy when using DCA bots. The current break-even line represents the break-even price of the current deal and it includes all DCA orders filled so far. The final break-even line represents the break-even price the current deal will achieve once all DCA orders are filled.</p><p><img src="https://back.gainium.io/uploads/breakeven_494a590545.png" alt="breakeven.png"></p>

This article explains how the Current Break-Even and Final Break-even lines are calculated and how you can use them to your advantage when creating trading bots.

Current Break-Even and Final Break-even lines

<p>Cryptocurrency markets have witnessed phenomenal growth in the past few years, attracting both experienced traders and new investors. As the market evolves, the need for a well-defined trading strategy becomes increasingly critical for success. One effective way to achieve this is by using backtesting. In this article, we will delve into the concept of backtesting, its benefits, and how you can use it in Gainium to optimize your crypto trading strategies.</p><h2>What is backtesting?</h2><p>Backtesting is the process of testing a trading strategy back in time to see how it would have performed on historical data, and to find any potential improvements that could be made. This technique has been widely used in traditional financial markets, and its application in the crypto trading sphere has proven to be equally valuable.</p><h2>Benefits of Backtesting in Crypto Trading</h2><ul><li><strong>Risk Management</strong>: One of the most significant advantages of backtesting is its ability to help traders manage risk. By analyzing historical data, traders can identify the potential drawdowns and gains associated with a strategy, allowing them to make informed decisions on risk exposure.</li><li><strong>Strategy Optimization</strong>: Backtesting enables traders to fine-tune their strategies by identifying the most effective parameters. This process helps optimize trade entry and exit points, as well as other aspects such as stop-loss orders and position sizing.</li><li><strong>Performance Evaluation</strong>: Traders can gauge the effectiveness of their strategies by measuring key performance indicators (KPIs) such as the win rate, return on investment (ROI), and risk-reward ratio. This information is crucial in determining whether a strategy is worth pursuing.</li><li><strong>Emotional Control</strong>: By simulating the trading process using historical data, traders can gain experience and build confidence in their strategies, leading to better emotional control and decision-making during real market conditions.</li></ul><h2>Backtesting considerations</h2><p>Keep the following in mind:</p><ol><li><strong>Past results are not indicative of future results.</strong> Just because a strategy performed well over a period of time, it doesn't mean that it will continue to do so in the future. Markets are dynamic, and the conditions may change at any time.</li><li><strong>Backtesting tends to give better performance than real trading.</strong> This is because there are certain things the backtest will not be able to emulate, as they are related to the exchange itself. For example, when trading volume spikes over a short time, exchanges may not be able to fill your order.&nbsp;</li><li><strong>Backtesting software uses ohlc candles to backtest</strong>, but this can be problematic because it does not take into account the order book and how different orders would have been filled at different prices. The greater the time-frame, the greater chance that inaccuracy could happen.</li></ol><p>Backtesting will never be able to replicate real-world trading conditions perfectly, so there is always a risk that your strategy may not perform as well in the future as it did in the past. With that said, backtesting can still be a valuable tool if used correctly. Backtesting can help you improve and optimize your trading strategy, giving you confidence in your strategy before using it with real money.&nbsp;</p><p>Moreover, while sometimes backtesting can give better than actual trading results, it does not give worse results than actual trading. This means that if a strategy has poor performance on a backtest, it would have definitely performed poorly in actual trading. Therefore, backtesting is a good first-pass filter, helping you avoid using underperforming strategies.</p><p>When backtesting a crypto trading bot, there are a few things to keep in mind:</p><ul><li>Make sure to span a wide enough period encompassing different market conditions.</li><li>Be aware of backtesting biases. Overfitting is a common bias that can occur when backtesting. Overfitting occurs when the strategy has been over-optimized to match the backtest data too closely, and therefore it will be very different of future performance. To avoid overfitting, it is important to test your trading strategy on a variety of data sets and to not make any assumptions about how the market will behave in the future.</li><li>Take into account slippage and fees. When backtesting, most people do not take into account slippage and trading fees, which can eat into your profits. Make sure to factor these in when backtesting so that you have a more accurate idea of how your strategy would perform in the real world.</li></ul><h2>Performing a backtest in Gainium</h2><p>With Ganium you can backtest your bot configuration right from the bot creation page, so you can get a sense of past performance. This way, you can make the necessary adjustments and deploy your bot when you are satisfied with the backtesting results.</p><p>To backtest a trading strategy, click on “Trading bots” on the sidebar and then “+ New” to launch the new bot page. Here you can set the desired configuration for your bot, including deal start condition, Take Profit, Stop loss, DCA, etc. Then click the “Backtest” button at the bottom. The backtesting results will show in the panel underneath.&nbsp;</p><p><img src="https://back.gainium.io/uploads/backtesting1_d6e7a37fd8.png" alt="backtesting1.png"></p><p><img src="https://back.gainium.io/uploads/backtesting2_07cb1cc61c.png" alt="backtesting2.png"></p><p><img src="https://back.gainium.io/uploads/backtesting3_87b77191fa.png" alt="backtesting3.png"></p><h2>Upcoming backtesting features</h2><p>At Gainium, we understand that backtesting is an important tool for every trader. Our goal is to create the most reliable backtesting system in the market. So while we are happy to launch the backtesting module, there is still a lot of work to be done.&nbsp;</p><p>Stay tuned for more updates soon!</p>

With Ganium you can backtest your bot configuration right from the bot creation page, so you can get a sense for past performance. This way you can make the necessary adjustments and and deploy your bot when you are satisfied with the backtesting results. Learn how to backtest with Ganium on this article.

Backtesting Trading bots

<p>Understanding financial jargon can be a challenging endeavor. It can be confusing to make sense of it all when presented with so many vital financial key metrics.</p><p>One misconception users commonly experience is the relationship between the profit generated and the account's value. The question is usually this: “If my account balance was X when I started and the bots generated Y in profit, how come the current balance is not X+Y?”.</p><p>To understand how this is possible, let's go over an example.</p><p>Jimmy starts with 1000 USDT on his account. He sets up an ETH/USDT grid bot with a 1000 USDT budget. The bot runs for a week and generates 100 USDT in profit. He expects his account value to be around $1100, but to his surprise, it is $990. How is it possible?</p><p>The answer is <strong>value change</strong>.</p><p>We have to clarify the concept of realized and unrealized profit. When the bot starts, it buys crypto, which will be sold later for a profit. In the case of Jimmy's grid bot, it will gradually sell ETH as the price increases. Every time the bot sells, it <strong>realizes a profit</strong>. The total profit realized, 100 USDT, is what the bot reports in the profit section. This is the value of the crypto profit generated (excluding exchange fees), and it's already added to your account balance. However, the bot still holds ETH, and that ETH might have gone down in value since purchase, which we call the <strong>unrealized profit</strong>.</p><p>Therefore, we need another metric to consider the realized and unrealized profit so we can better understand what's going on. This is what value change tells us. Value change takes into account the initial value of the bot at the start (around $1000), the current value, including the ETH it is still holding, and the profit generated.&nbsp;</p><figure class="image"><img src="https://back.gainium.io/uploads/value_change_e3a9795f57.png" alt="value_change.png"></figure>

In this article we review a topic that often confuse users. Why is my account balance not matching the profit stats generated? Here we explore the answers and go through an example.

Making sense of profit stats, value change, and account value

<p>In this article we will go over how to configure your trading bots with webhooks.</p><p>Create a <a href="https://app.gainium.io/bot/new">new bot</a> and scroll down to deal start condition, select “Web Hook”.</p><p><img src="https://back.gainium.io/uploads/webhooks_8680099d81.png" alt="webhooks.png"></p><p>Configure the rest of the bot, setting your desired take profit, stop loss and DCA orders. Once you are happy with the bot configuration, click on “Add new bot” and a new info box will appear with the webhook information.</p><p><img class="image_resized" style="width:50%;" src="https://back.gainium.io/uploads/webhook_config_9e09b29865.png" alt="webhook config.png"></p><p>Next, head to your webhook provider, in this case we will use TradingView as an example.</p><p>On the indicator of your choosing, click on “More” (the three dots at the end of the indicator name), then “Add alert on…”.&nbsp;</p><p><img src="https://back.gainium.io/uploads/TV_add_alert_25a34c4c24.png" alt="TV-add-alert.png"></p><p>You will be presented with the following window. Click on “Webhook URL”.</p><p><img class="image_resized" style="width:50%;" src="https://back.gainium.io/uploads/tv_alert_33541b208e.png" alt="tv-alert.png"></p><p>You may input the webhook URL and the message as shown in your bot info. The alert name can be anything you want. Click on create and that's it!&nbsp;</p><p>There are 2 types of webhook actions:</p><ul><li>Open deal: will instruct the bot to start a new deal.</li><li>Close all deals: will instruct to close all open deals at market price.</li></ul><p>Make sure your bot is turned on, and it will be listening for incoming webhooks to execute actions.</p><p>&nbsp;</p>

Learn how to send webhooks to your trading bots and use them as entry trigger signal for trading.

Webhooks - Send signals from TradingView and other programs

<p>Have you ever heard the quote: "Bulls make money, bears make money, but pigs get slaughtered."? This means that it's important to take profits when the market is in your favor rather than being too greedy and risking losing everything.</p><p>Multiple Take Profits is a feature that allows you to partially exit your deal at different take profit levels. Having multiple take profit levels can help your trading in several ways:</p><ol><li><strong>Risk Management</strong>: Multiple TPs allows you to secure partial profits at various stages. This approach helps to mitigate the risk of market fluctuations and ensures you lock in gains along the way.</li><li><strong>Profit Maximization</strong>: This flexible approach enables you to capitalize on short-term price spikes while still leaving room for further growth.</li><li><strong>Control your greed</strong>: Many traders let their winning trades run, but sometimes get too comfortable and do not take profits along the way, ignoring the fact that markets can reverse quicker than anticipated. Using multiple take profit targets can help maintain emotional stability by reducing the stress of deciding when to exit a position entirely. With a predefined plan, you can trade more confidently and avoid making impulsive decisions (or not making any at all).</li><li><strong>Adaptable</strong>: Employing multiple take profit targets allows for greater adaptability to changing market conditions. You can adjust your targets as needed based on your analysis of market trends, technical indicators, or changes in market sentiment.</li></ol><p>Imagine this scenario: you have an open deal for a token currently trading at $10. You are very confident that $12 will be reached in the short term, reasonably confident that $14 will be reached in the short to medium term, and hopeful that $18 and beyond will be reached sometime in the next few weeks.</p><p>By using multiple take profits, you can exit the position proportionally to the level of confidence you have for each target. An example could be:</p><ul><li>Sell 30% at $12</li><li>Sell 20% at $14</li><li>Sell 10% at $18</li><li>Sell 5% at $22</li><li>Sell 5% at $25</li></ul><p>Multiple TPs is a great risk-management strategy that helps us avoid making greedy decisions.</p><figure class="image"><img src="https://back.gainium.io/uploads/multiple_tp_chart_ee35d1cba9.png" alt="multiple-tp-chart.png"></figure><h2>Enabling Multiple TPs in Gainium</h2><p>To use multiple TP in your terminal in bot deals, enable the option in the Take Profit section. Then add as many targets as you wish and tweak them to your liking.</p><p>Here are a few things to keep in mind:</p><ul><li>You can add up to 10 TP targets as long as each target meets the minimum order size as dictated by the exchange</li><li>When DCA mode is enabled, TP targets are always calculated from the average order price</li><li>Once the first TP target is filled, all pending DCA orders will be canceled. This is to help avoid the situation where you sold part of the deal, then the price came back to fill a DCA order. In this case, the initial profit projection would not have been accurate, so in order to avoid confusion and unexpected results, we decided to cancel pending DCAs.</li></ul><figure class="image"><img src="https://back.gainium.io/uploads/multiple_tp_3fc49eab62.png" alt="multiple-tp.png"></figure>

Discover how multiple take profit targets can help boost your crypto trading strategy. Explore the benefits and learn how to implement it in Gainium.

Using Multiple Take Profit targets

This article shows you how to set up a DCA bot by walking through a practical example.

DCA bot set up walkthrough

<p>A common technique traders use to secure their profits and avoid risk is moving the stop loss to profit or breakeven once the trade has reached a certain unrealized profit. This way, the trade is still open to hit the take profit target, but a certain profit will be guaranteed (or at least avoid a loss) in case of a reversal.</p><h2>Using move stop loss option in Gainium</h2><p>In Gainium, you can use the move stop loss option in trading bots and terminal deals under the Stop Loss section.</p><figure class="image"><img src="https://back.gainium.io/uploads/move_sl_b578c49465.png" alt="move-sl.png"></figure><p>In the screenshot above, we have set our stop loss to move to 3% profit when the position's unrealized profit reaches 5% profit.</p><p>There are some things to keep in mind when using this option:</p><ul><li>Move stop loss is incompatible with <a href="https://gainium.io/help/multiple-stop-loss-targets">multiple stop loss targets</a> and <a href="https://gainium.io/help/trailing-stop-loss">trailing stop loss</a>.</li><li>Try not to use an unrealized profit trigger and stop loss value that are too close to each other, or you will very likely hit the new stop loss almost immediately (always aim for more than 1% space between the two)</li><li>If the stop loss move over DCA orders, they will be cancelled</li></ul>

Learn how to move stop loss option works and use it to your advantage.

Move Stop Loss

<p>Multiple stop loss targets are a feature that allows you to partially exit your deal at different stop loss levels. Although not as popular as <a href="https://gainium.io/help/multiple-take-profit-targets">multiple take profit targets</a>, there are some scenarios for which this feature is worth considering.</p><p>One such scenario is, for example, when you create a Smart Sell terminal deal that is already in profit. You would like to hit a take profit target, but at the same time, you would like to gradually exit the position if the market starts moving against you.&nbsp;</p><h2>Enabling multiple stop loss targets in Gainium</h2><p>You can find this option under Stop Loss settings.</p><figure class="image"><img src="https://back.gainium.io/uploads/multiple_sl_7486e936a4.png" alt="multiple-sl.png"></figure><p>Please keep in mind the following:&nbsp;</p><ul><li>Multiple stop loss targets are incompatible with <a href="https://gainium.io/help/move-stop-loss">move stop loss</a> and <a href="https://gainium.io/help/trailing-stop-loss">trailing stop loss</a>.</li><li>If DCA Mode is enabled, stop loss targets are calculated from the average position size.</li></ul>

Learn what multiple stop loss targets are and how to use it for your trading.

Multiple Stop Loss targets

<h2>What is a Trailing Stop Loss</h2><p>Trailing stop loss is a popular trading technique that enables you to follow the trend. The principle behind it is simple: the trailing stop loss moves in the direction of your take profit, and it's always spaced the same percentage from the best price.</p><p>The standard stop loss order is used to limit potential losses by automatically selling a cryptocurrency if it drops below a specific price. This can be useful for limiting potential losses but can also result in missing out on potential profits if the cryptocurrency rebounds shortly after the sell order is executed. Trailing stop loss orders allows traders to benefit from upward price movements while limiting potential losses in the event of a sudden downturn.</p><p>Let's look at an example. You open a long position, set the stop loss to -10%, and then enable trailing. At the start of trade, the stop loss will be positioned precisely -10% from the price; however, as the price moves up, the stop loss will move upwards, always spaced 10% from the highest price.</p><h2>Pros and cons of using Trailing Stop Loss</h2><p>The benefits of using a trailing stop loss in crypto trading are numerous. It allows traders to take advantage of upward price movements while still limiting potential losses. It also reduces the need for constant monitoring of price movements, as the trailing stop loss order will automatically adjust as the cryptocurrency moves in a favorable direction. Additionally, it can help to remove emotions from trading decisions, as the trader has already predetermined the level of risk they are willing to take.</p><p>However, it is essential to note that trailing stop loss orders are not foolproof and can result in losses if the market moves quickly and unexpectedly. In highly volatile markets, the price of a cryptocurrency can fluctuate rapidly, triggering a stop loss order before rebounding in the trader's favor. Additionally, if the market experiences a sudden downturn or crash, a trailing stop loss order may not be executed at the desired price, resulting in larger-than-expected losses.</p><h2>Enabling trailing stop loss in Gainium</h2><p>You can find this option under the Stop Loss section of your trading bot or terminal deal.</p><figure class="image"><img src="https://back.gainium.io/uploads/trailing_sl_ed28b6b7eb.png" alt="trailing-sl.png"></figure><p>There are a few things you should keep in mind when using trailing stop loss:</p><ul><li>Trailing stop loss is incompatible with <a href="https://gainium.io/help/multiple-stop-loss-targets">multiple stop loss targets</a> and <a href="https://gainium.io/help/move-stop-loss">move stop loss</a>.</li><li>If DCA Mode is enabled, the stop loss target is calculated from the average position size.</li><li>If the stop loss move over DCA orders, they will be cancelled</li></ul>

Learn more about trailing stop loss and how to use it in Gainium

Trailing Stop Loss

<p>One essential aspect of a successful trading strategy is knowing when to sell to maximize profits, which as any experienced trading will tell you, it's more of an art than a science. Trailing Take Profit is a popular rule-based technique allowing traders to maximize profits.</p><h2>What is Trailing Take Profit?</h2><p>Simply put, a trailing take profit is a dynamic order type that allows you to lock in profits as the market moves in your favor. It works by automatically adjusting the take profit level as the price of the asset moves in your favor, ensuring that you close the position at an optimal price if the market turns. This strategy helps traders avoid missing out on potential gains while providing protection against sudden market downturns.</p><h2>A practical Trailing Take Profit example</h2><p>To better understand how a trailing take profit works, let's consider a hypothetical example using the BTC/USDT trading pair.</p><p>Suppose you purchase 1 Bitcoin (BTC) at $50,000 and set a trailing take profit of 5%. This means that if the price of Bitcoin increases, the take profit level will follow the price, always maintaining a 5% gap. If the price of Bitcoin rises to $60,000, your take profit level adjusts to $57,000. If the market then declines and reaches $57,000, your position will be automatically sold, securing a $7,000 profit.</p><p>This strategy allows you to capitalize on the upward price movement while still providing a safety net should the market reverse.</p><h2>When to use Trailing Take Profit</h2><p>Trailing take profit is best used in trending markets, where the price of an asset moves consistently in one direction. It allows traders to capture a significant portion of the trend's gains without prematurely exiting the position.</p><p>However, there are also some situations where you may want to avoid it:</p><ul><li>Volatile Assets: Assets with high volatility can experience rapid price movements. A trailing take profit uses a market order, which can result in high slippage during rapid price movements.</li><li>Low liquidity: As with high volatility, a low liquidity market may result in your market order being executed at a substantially different price than anticipated.</li><li>Range-bound Markets: In range-bound markets, where the price oscillates between a well-defined support and resistance level, a trailing take profit may lead to premature exits due to relatively small price movements.</li><li>Tight Trailing Distance: Setting a too tight trailing distance can result in your position being closed too soon, missing out on potential profits. It's crucial to strike a balance between protecting your profits and allowing for price fluctuations.</li></ul><h2>Enabling Tailing Take Profit in Gainium</h2><p>You can enable Trailing Take Profit in Trading Bot and Trading Terminal deals under Take Profit section.&nbsp;</p><figure class="image"><img src="https://back.gainium.io/uploads/trailing_take_profit_f5ddf3d1c4.png" alt="trailing-take-profit.png"></figure><p><strong>Trading tip</strong>: a good rule of thumb is to set your trailing take profit deviation between 10 to 25% of your take profit target.</p>

Enhance your trading strategy by mastering trailing take profit with this comprehensive guide, including when to use it, when to avoid it, and how to enable it in Gainium.

Trailing Take Profit

<p>HODL bots are an increasingly popular method for cryptocurrency investors to automate their investments using the Dollar Cost Averaging (DCA) strategy. In this article, we will delve into the concept of HODL bots, how they work, and illustrate their application with an example.</p><h2>What is a HODL Bot?</h2><p>A HODL bot is an automated investment tool that follows the traditional Dollar Cost Averaging strategy (DCA), allowing users to consistently invest in a particular asset over time, regardless of market fluctuations. This approach aims to mitigate the impact of volatility on the investor's portfolio by purchasing the asset at various price points, effectively averaging out the cost basis over time.</p><h2>How Does a HODL Bot Work?</h2><p>HODL bots enable users to choose the specific asset they want to invest in and the frequency of their investments. Investors set the amount they wish to invest, and the bot will automatically execute the investment plan according to the specified schedule. This ensures that the investor buys the asset during highs and lows, resulting in a more balanced and less volatile portfolio performance.</p><p>Consider an investor who wants to invest in BTC. They decided to use a HODL bot, such as the one provided by Gainium, to automate their investment strategy. The investor has $1,000 to invest and wants to spread their investment over a 100-day period.</p><p>The investor configures the HODL bot to buy $10 worth of BTC using USDT every day. Over the course of the next 100 days, the bot will automatically execute the purchases, regardless of Bitcoin's price. This strategy ensures that the investor buys Bitcoin during its highs and lows, effectively averaging the cost basis over time.</p><p>Using a HODL bot to buy BTC allows the investor to avoid the emotional pitfalls and timing challenges often associated with manual investing. This approach allows the investor to focus on their long-term investment goals while mitigating the impact of short-term market volatility.</p><h2>Setting up a HODL bot in Gainium</h2><p>In Gainium, you can easily create a HODL bot by visiting the<a href="https://app.gainium.io/bot/new"> new bot page</a> and selecting “Time-based” as the deal start condition. You will be presented with the following settings:</p><figure class="image"><img src="https://back.gainium.io/uploads/HODL_bot_settings_c04a7c1ad0.png" alt="HODL-bot-settings.png"></figure><p>You can specify the period duration in days, the time of the day (in your timezone), and when should the next deal start. It's essential to notice that the total budget is dictated by the number of open deals the bot is allowed to have. For example, if you would like to invest $100 every week for a total of $1000, you would set the Max open deals to 10. Once the bot has reached the max open deals number, it will not open any more deals.</p><p>We have built the HODL bot with flexibility in mind, so you can use all options available for trading bots. That means you can enable DCA on each open deal or even activate Take Profit targets. This will allow you to deploy advanced such as the <a href="https://gainium.io/academy/double-dca-strategy">double-DCA</a>.</p><p>Note that each time the bot will open a separate deal. This has the advantage of being able to configure deals separately. However, if you would rather see the total accumulated token as a single deal, you can <a href="https://gainium.io/help/merge-deals">merge the deals</a> into one.</p><h2>Backtesting a HODL bot in Gainium</h2><p>You can backtest a HODL bot the same way you can backtest any trading bot in Gainium. See <a href="https://gainium.io/help/backtesting-trading-bots">this article</a> for a detailed guide on how to backtest a trading bot.</p><p>&nbsp;</p>

HODL bots are an increasingly popular method for cryptocurrency investors to automate their investments using the Dollar Cost Averaging (DCA) strategy. In this article, we will delve into the concept of HODL bots, how they work, and illustrate their application with an example.

HODL bot

<p>Mastering the art of timing the exit is vital to successful cryptocurrency trading, as it enables traders to protect their investments and capitalize on favorable market movements. While setting a % profit has been one of the most common ways to exit trades, you can now use indicator signals that take profit when market conditions change.</p><h2>Closing with indicators vs. percentage, which one is best?</h2><p>There is no rule set in stone, and the best deal close strategy will depend on your overall trading strategy, the token, and the market conditions. That said, <a href="https://gainium.io/help/backtesting-trading-bots">backtesting</a> your strategy with both options will give you great insight into what kind of performance you could expect using either one.</p><p>Some people prefer to close their trades using indicators because they are more responsive to changing market conditions. For example, indicators like RSI can accurately pinpoint when the asset is oversold or overbought and a change in market direction is imminent. Other traders, however, are comfortable keeping their deals open for as long as needed to meet the profit % they expect.</p><h2>Using Indicators Deal Close Conditions in Gainium</h2><p>When creating a trading bot or terminal deal, you have the option to close the deal with indicators by setting “Indicators” in the Take Profit section, the Stop Loss section, or both.</p><figure class="image"><img src="https://back.gainium.io/uploads/close_with_indicators_tp_72b6080ced.png" alt="close-with-indicators-tp.png"></figure><figure class="image"><img src="https://back.gainium.io/uploads/close_with_indicators_sl_b91f3ee627.png" alt="close-with-indicators-sl.png"></figure><p>Multiple Deal close conditions use "AND" logic, meaning all conditions must be true to close the deal, just like with Deal start conditions.</p><p>You can edit your bot and change the deal close conditions, but new bot settings apply only to new trades; old trades keep their original settings. You can also change current open deals from closing with indicators to percentage, but switching from one closing with indicator condition to another for an open deal is not possible.</p><h3>Minimum take profit</h3><p>If you are setting the indicators conditions deal close under Take Profit, you will have access to an additional configuration option, “Minimum take profit.” When the Minimum take profit option is activated, both the indicator conditions and the minimum take profit must be true simultaneously for the deal to be closed. Disabling the Minimum profit feature means the deal will close as soon as the Deal close condition is met, even if it results in a loss. Disable this feature carefully and with proper risk management in mind.</p><p>For example, let's say that your close condition is RSI 1H crossing up 80, and the Minimum take profit is 1%. On a particular candle, the RSI 1H goes from 76 to 84 (crossing up 80 is true), but the unrealized profit at that time is 0.5% (Minimum take profit is false); therefore, the deal will not be closed. On the next candle, the RSI goes from 84 to 87 (crossing up 80 is false), and the unrealized profit is 1.3% (Minimum take profit is true); the deal will also remain open.</p><p>Choosing the right combination of indicators and Minimum take profit is essential. In the previous example, the deal would have remained open until the RSI crosses up 80 again, at which point it will also need to evaluate the unrealized profit. If the trader intended to close the deal when the RSI was high and a Minimum profit achieved, it would have been better to choose RSI 1H &gt;80, which would have been evaluated as true on the second candle.</p>

You can now use indicator signals that take profit when market conditions change. This article explains how to close trades using Gainium's technical indicators deal close conditions.

Technical Indicators Conditions Deal Close

<p>Gainium's “Add funds” feature allows users to gain more control of their trading activities by increasing the volume of existing trading bots or terminal deals, lowering the average acquisition cost of the asset in the process. But how does it all work? Let's delve into it.</p><h2>Using the Add Funds Feature</h2><h3>Web UI</h3><p>The "Add Funds" feature works quite straightforwardly. It is supported by any smart or import deal created through the terminal and any deal started by a trading bot. Once the deal is created, you can use this feature to add more funds to it. This option is accessible through the deal menu, which opens a pop-up window allowing you to specify the following parameters:</p><figure class="image"><img src="https://back.gainium.io/uploads/Add_funds_web_UI_02049e1c16.png" alt="Add_funds_webUI.png"><figcaption>Add Funds through UI</figcaption></figure><p><strong>Amount</strong>: This is the volume of funds that you want to add to the deal. It's essentially the additional sum you're willing to invest.</p><p><strong>Currency</strong>: Here, you can add the amount reference in either the base or the quote currency. It's important to note that for a long deal, the quote currency is always added, and for a short deal, the base currency is added.</p><p><strong>Order Type</strong>: You can choose between a limit order or a market order. The former allows you to buy or sell an asset at a specific price or better, while the latter executes your order at the current market price.</p><p><strong>Limit Price</strong>: If you chose a Limit Order, you can specify the order price here.</p><h3>Webhook</h3><p>You can also execute the “Add Funds” feature through a webhook, regardless of the deal start condition used in your trading bot.&nbsp;</p><figure class="image"><img src="https://back.gainium.io/uploads/Add_funds_webhook_1504158676.png" alt="Add_funds_webhook.png"><figcaption>Add Funds Webhook</figcaption></figure><p>Some considerations when using the Add Funds feature through webhooks:</p><ul><li style="margin-left:0px;">For a single coin bot, it will add the specified funds to all open deals. For example, if you have 2 open deals and send a webhook to add 20 USDT, it will add 20 USDT to <strong>each deal</strong>, totaling 40 USDT.</li><li style="margin-left:0px;">For multi-coin bots, you will see two options:<ul><li style="margin-left:0px;">Add funds to all open deals</li><li style="margin-left:0px;">Add funds to all open deals of a specific symbol</li></ul></li><li style="margin-left:0px;">Adding funds through webhooks only support market orders</li></ul><h3>API</h3><p>Check the <a href="https://api.gainium.io/api/docs/#/Deals/post_api_addFunds">Add Funds API documentation</a> and examples.</p><h2>Tips for Using the Add Funds Feature</h2><ul><li>Consider Your Risk Tolerance; adding funds to a deal increases your exposure.</li><li>Monitor the Market: Regularly watch the market and use the "Add Funds" feature when you feel the market conditions are favorable.</li><li>Diversify: Don't pour all your funds into one deal. Ensure your investments are diversified.</li><li>Use Limit Orders for Precision: If you're targeting a specific price, use a limit order. This order type provides a greater degree of control over the price you pay or receive.</li></ul><h2>An Example Using ETH/USDT</h2><p>Let's walk through an example using the ETH/USDT pair. Assume you've already initiated a long deal with 1 ETH when the price was at $2000. However, the price has since dropped to $1800. You would like to add 0.5 ETH more to your deal.</p><p>Here's how you could use the "Add Funds" feature:</p><ul><li>Click on "Add Funds" and input an amount of 900 USDT or 0.5 ETH (both options will add an additional 900 USDT).</li><li>Choose “Market” if you want the order to execute immediately at the current market price, or choose “Limit” if you want to specify at what price should the order execute.</li></ul><p>This move will buy you more ETH at a reduced price, lowering the average acquisition cost. It will also position you to gain more if the price of ETH rises again.</p><p>Please remember that trading cryptocurrency always comes with risks, and it's essential to manage your trades carefully. Use the "Add Funds" feature judiciously, and remember to adjust your strategies based on the ever-evolving market conditions.</p><p>In conclusion, our new "Add Funds" feature provides a significant advantage by allowing you to capitalize on market fluctuations and lower your average asset acquisition cost. Whether you're a seasoned trader or a newcomer, it's a valuable tool to enhance your trading strategy. Happy trading!</p>

Gainium's “Add funds” feature allows users to gain more control of their trading activities by increasing the volume of existing trading bots or terminal deals, lowering the average acquisition cost of the asset in the process. But how does it all work? This article explains how.

Add funds to deals

<p>Ladies and gents, I'm thrilled to introduce a nifty new feature designed to give you greater control over your trading strategies: the Volume Filter. Let's dive right in!</p><h2>Understanding the Basics</h2><p>The core purpose of the Volume Filter is to keep you from trading low-volume tokens inadvertently. Now, don't get me wrong. Lower-volume tokens can sometimes offer enticing opportunities, but they also carry a higher degree of risk, mainly due to low liquidity. It could be akin to walking on a tightrope with no safety net! This feature acts as that safety net, allowing you to focus on tokens with a more substantial trading volume and greater liquidity.</p><h2>How Does It Work?</h2><p>The Volume Filter operates based on token trading volume data across all exchanges. This data is updated hourly, ensuring you always deal with the most current information.</p><p>You can use the Volume Filter when setting up your multi-coin trading bots on Gainium. When activated, it limits your bot to trading only the top tokens by trading volume. And how does it define 'top'? Well, that's up to you.</p><p>You could choose to have your bot trade only the top 25, or maybe you feel more adventurous and go for the top 100. You could even punch in a custom number, like 500, and have your bot trade only the top 500 tokens by trading volume. The choice is entirely in your hands.</p><figure class="image"><img src="https://back.gainium.io/uploads/volume_filter_9c6a84d374.png" alt="volume-filter.png"><figcaption>Volume filter in Gainium</figcaption></figure><h2>Why is this Feature Important?</h2><p>In this rapid, ever-changing world of crypto trading, sifting through and focusing on tokens with more substantial trading volumes can be a game-changer. This feature allows you to navigate through the sea of tokens and zero in on those that meet your specific volume criteria. This strategic maneuvering can drastically reduce your exposure to less liquid coins, which can sometimes be harder to buy or sell without impacting the token's price.</p><h2>How can I check a token's trading volume?</h2><p>We have developed a nifty <a href="https://gainium.io/crypto-screener">screener</a> that contains trading data. This is the same data the bots use to check the top coins. To access the screener, look for the menu item in the left-hand menu. You can sort the volume column to check the position of a certain token.</p><figure class="image"><img src="https://back.gainium.io/uploads/screener_volume_aa6335aa2c.png" alt="screener-volume.png"><figcaption>Gainium crypto screener</figcaption></figure><h2>Wrapping it up</h2><p>At Gainium, we're all about harnessing the power of technology to make your trading experience smoother, safer, and more efficient. This new feature is yet another step towards that goal, giving you the power to create more tailored trading strategies with our multi-coin trading bots.</p><p>Remember, the crypto market is a wild ride, and while it can offer some exciting opportunities, it's essential to be strategic about your trading decisions. That's where our Volume Filter comes in. Set boundaries, let your bots loose, and watch them work their magic.</p><p>So give it a whirl, and let us know how you find it. We're always here to help if you've got any questions.&nbsp;</p>

Volume Filter keeps you from trading low-volume tokens inadvertently. We explain how to use this feature in this article.

Volume filter

Trading Bots

Resolve common problems related to grid bot trading.

Grid bot.svg

<p>In arithmetic grids, the grids are consistently spaced by the same amount of quote. For example, if we are trading BNB/USDT, we could make an arithmetic grid with buy and sell orders every 20 USDT.</p><figure class="image"><img src="https://back.gainium.io/uploads/arithmetic_grid_f576651831.webp" alt="arithmetic grid.webp"><figcaption>Arithmetic Grid Type</figcaption></figure><p>In geometric grids, the grids are consistently spaced by the same % difference in price. In the case of BNB/USDT, we could make a grid with buy/sell orders 1% apart.</p><figure class="image"><img src="https://back.gainium.io/uploads/geometric_grid_8de1b93f9f.webp" alt="geometric grid.webp"><figcaption>Geometric Grid Type</figcaption></figure><h2>When should you use arithmetic or geometric grid types?</h2><p>It comes down to your personal preference and trading style, but you should know that geometric grid types are “bottom heavy” while arithmetic grids are evenly spaced across the range. For this reason, there are more buy orders in a geometric grid than in an arithmetic grid.</p>

In this article we explain the difference between arithmetic and geometric grids and in when should you use each grid type.

Arithmetic and Geometric grid types

<p>The sell displacement is an extra price % added to grid distance, which increases the distance between a buy and its corresponding sell order. Note that this does not affect the distance between buy orders and sell orders, only between a buy and its corresponding sell order.</p><p>This is used to avoid users losing money on exchange fees. Hence the minimum setting is double the exchange fee.</p><p>There are, however other cases in which increasing this gap may be helpful. If you have detected a price range and would like to maximize your profits, increasing the sell displacement will allow you to concentrate the buy orders towards the bottom and the sell orders towards the top of the range.</p><figure class="image"><img src="https://back.gainium.io/uploads/sell_dsplacement_028be72d95.webp" alt="sell-dsplacement.webp"><figcaption>Sell displacement in a range.</figcaption></figure>

Learn how to sell displacement works and how to take advantage of this feature.

Sell displacement

<p>When setting up your grid bot, you must select if you want to fix the orders in base or quote currency. Conversely, trading pairs are usually represented as BASE/QUOTE (for example, BTC/USDT).</p><p>When the orders are fixed in base, each grid will have the same fixed amount of base per grid, and when the orders are fixed in quote, each grid will have the same fixed amount of quote value.</p><p>When you fix the orders in base, the quote value of the grids at the bottom is less than that of the top. Hence you will be making more significant profits at the top of the range. When you fix the orders in quote, the quote value of the grids is the same across the range; hence the profit between the grids is also the same.</p><p>Choosing which one to use comes down to your trading style and preferences.&nbsp;</p>

Learn about fixing your grid bot orders in base or quote and when you should use each.

Order fixed in Base and Quote (Grid bots)

<p>The grid step, or the separation between the grids, it's an essential factor to consider when setting your grid strategy. As you may have guessed, a lower step will increase the number of transactions and lower the profit per transaction, so where is the sweet spot? Let's dive in.</p><h2>Finding the right grid step for your strategy</h2><p>Before asking yourself what grid step you should be using, you have to consider two critical questions:</p><ol><li>What is your budget?</li><li>How wide do you want the trading range to be?</li></ol><p>The answer to these two questions may limit the grid step you can use. If you have a small budget, you will have no choice but to allow for a bigger grid step to cover a decent trading range.&nbsp;</p><p>If budget is not an issue, then the next question is how wide should the trading range be. The wider the range, the more you spread your funds. Hence the less profit per transaction, but the more likely the price will stay within range. So, there is another “sweet spot” to be considered here.</p><p>As a general rule of thumb, you would want to emphasize the budget and the trading range more than the grid step. If budget is not an issue and you have already set a trading range you are comfortable with, then you can aim for a 0.5-1% grid step. You can use around 0.5% for less volatile coins (top 10 by market cap) and 1% or even more for the more volatile currencies.</p><p>&nbsp;</p>

Learn how to optimize the grid step for maximum profitability.

Grid Step

<p>The budget is the<strong> quote value </strong>of the funds held by the bot at the start. The budget will always remain close to the initial value of the funds of the bot.</p><h2>Minimum budget</h2><p>Because exchanges impose a minimum order quantity (usually around USD 10), a bot will have a minimum budget required to be initialized. This is roughly equivalent to the number of orders * 10 USD.</p><p>If you would like to decrease the minimum budget necessary to start the bot, you can remove grid levels from the bot. Changing the currency in which orders are fixed, and the profit currency can also affect the minimum budget.</p>

Learn how the budget in the grid bot works.

Budget (Grid Bots)

<p>The <strong>initial funds</strong> represent the state of the bot at the start and the current value of these funds if you only held them. In other words, this is the value of the funds if you just “buy-and-hold” instead of using the bot.&nbsp;</p><p>The <strong>current funds</strong> represent the present value of the funds held by the bot, including any profit made. You can also see extra information such as the <a href="https://gainium.io/help/breakeven-price-grid">breakeven price</a>.</p><p><img src="https://back.gainium.io/uploads/initial_current_funds_acbe2d7fd7.webp" alt="initial_current_funds.webp"></p><p>Note: when the stats are displayed in base currency, you will see that when the value of the base in quote currency has increased, you get a negative PnL and when it has decreased, the PnL is positive. This is because we are taking the PnL from the point of the base, so when</p><p><img src="https://back.gainium.io/uploads/initial_negative_base_95ae5704f0.webp" alt="initial_negative_base.webp"></p><p>&nbsp;</p>

Initial and Current Funds (Grid Bots)

<p>The breakeven price definition is straightforward: the price you would need to sell the base currency that the bot is holding to break even. In other words, it's the price at which your initial value equals the current value of the bot. Now let's review a few nuances to understand better what's happening behind the scenes and what we could expect in different scenarios.</p><h2>How is the breakeven price calculated?</h2><p style="margin-left:0px;">The general formula is</p><blockquote><p style="margin-left:0px;"><strong>break-even price</strong> = (initial value in quote - current quote quantity - profit<i><sup>*</sup></i> value in quote) /&nbsp;current quantity of base</p></blockquote><p style="margin-left:0px;"><sup>*</sup>Exchange fees <a href="https://gainium.io/help/are-exchange-fees-excluded-from-profit-calculation">are excluded</a> (accounted for) in profit calculation.</p><p style="margin-left:0px;">And to better understand what this means, let's go over an example.</p><h2 style="margin-left:0px;">Example</h2><p style="margin-left:0px;">Let's say you set up a bot for BNB/BUSD. Let's use some easy numbers for the sake of calculation:</p><p style="margin-left:0px;">Initial funds:</p><p style="margin-left:0px;">Base = 1 BNB</p><p style="margin-left:0px;">Quote = 100 BUSD</p><p style="margin-left:0px;">Initial BNB price = 300 BUSD</p><p style="margin-left:0px;">In this case our initial value = 1 * 300 + 100 = 400 BUSD</p><p style="margin-left:0px;">Then the bot went to work, and after some time, we have the following funds:&nbsp;</p><p style="margin-left:0px;">Base = 0.5 BNB</p><p style="margin-left:0px;">Quote = 175 BUSD</p><p style="margin-left:0px;">Profit = 100 BUSD</p><p style="margin-left:0px;">By definition, the breakeven price is the price at which the initial fund's value equals our current fund's value, so we get the formula:</p><p style="margin-left:0px;">400 BUSD (initial value) = 0.5 BNB * X BUSD/BNB (breakeven price) +175 BUSD (current quote balance) + 100 BUSD (bot profit)</p><p style="margin-left:0px;">Breakeven price = (400 BUSD - 175 BUSD - 100 BUSD) /&nbsp;0.5 BNB = 250 BUSD/BNB</p><p style="margin-left:0px;">In other words, if you were to sell 0.5 BNB at 250 BUSD/BNB, your current funds would equal your initial funds, breaking even. Selling at any price over 250 BUSD/BNB will make you a profit.</p><h2 style="margin-left:0px;">How does the breakeven price change over time?</h2><p style="margin-left:0px;">It's essential to notice that the breakeven price is dynamic. As the bot generates profit, the breakeven price decreases over time. However, that doesn't mean it can get lower only. If the value of the base falls, the breakeven price can increase, especially at the beginning when there isn't much profit generated.</p><p style="margin-left:0px;">To follow the previous example, let's say that when we calculated the breakeven price of 250 BUSD/BNB, the current price is 290 BUSD/BNB. If we stopped the bot at that moment and the price dropped to 250 BUSD/BNB, then we could sell and break even. However, if the bot were working during the drop, it would keep adding BNB to the balance as the price drops; hence the breakeven price would increase.</p><p style="margin-left:0px;">The breakeven price can be negative if the current quote balance and profit values are more than the initial value, so no matter at which price you sell the base, you would be making a profit. In that case, the breakeven price will show 0 in the price chart.</p><p style="margin-left:0px;">&nbsp;</p>

Learn how the breakeven price is calculated and how it can evolve over time.

Breakeven Price (Grid bots)

<p>As the cryptocurrency market continues to evolve, so do the tools and strategies traders employ. Grid bots have emerged as a popular solution for automating trading strategies, and understanding the intricacies of their features is crucial for success. In this article, we'll explore the stop loss and take profit features in grid bots, highlighting their significance and providing tips for optimizing your trading experience.</p><h2>Understanding Stop Loss and Take Profit in Grid Bots</h2><p><strong>Stop Loss</strong>: A stop loss is an order that automatically closes a position if the market price reaches a specified level, preventing further losses. In the context of grid bots, a stop loss is triggered when the price moves against your trading strategy, mitigating potential losses and protecting your trading capital.</p><p><strong>Take Profit</strong>: Conversely, a take profit is an order that automatically closes a position once the market price reaches a predetermined level, securing profits. Grid bots utilize take profit orders to capitalize on favorable market movements, ensuring that gains are locked in before the market reverses.</p><h2>Using Take Profit and Stop Loss Features in Gainium's Grid Bots</h2><p>These options are in your grid bot's Take Profit or Stop Loss section.</p><p>There are two possible triggers for these features:</p><ol><li>When the price is reached: the stop loss or take profit is triggered at a specific price that you specify</li><li>When the bot's value reaches a specific % change that you specify (current funds value % in quote currency). Please note that the % change is always measured in quote currency; other system currencies will be ignored.</li></ol><p>These two features work in the same way: when the take profit or stop loss trigger condition is met, the bot stops and performs one of two possible actions:</p><ol><li>Cancel and sell base: The bot stops, cancels all pending orders, and sells base at market price.</li><li>Cancel orders: The bot stops and cancels all pending orders only, leaving the remainder base on the exchange.</li></ol><p>Let's see how they work with some practical examples.</p><h3>Example #1</h3><p>Imagine you have an active bot on BNB/BUSD. The current BNB/BUSD price is 300, and you set the stop loss at 280 BUSD, with the action “Cancel orders.” If the price moves down to 280 BUSD, the bot will stop and cancel all pending orders. The BNB that the bot purchased is accessible in your exchange's balance.</p><h3>Example 2</h3><p>You have an active grid bot on ETH/BTC pair and set the take profit at a value change of 15% with the action “Cancel and sell base.” In this case, when the value of your current funds reaches 15%, the bot will stop, cancel all pending orders and sell all ETH at market price.</p><h2>Tips for Optimising Stop Loss and Take Profit Features in Grid Bots</h2><ul><li>Define Your Risk Tolerance: Before implementing stop loss and take profit orders, determine your risk tolerance and trading objectives. This will help you set appropriate levels that align with your overall trading strategy.</li><li>Regularly Review and Adjust: Periodically review your grid bot's performance and make necessary adjustments to your stop loss and take profit settings. Continuously refining your strategy will ensure it remains effective in changing market conditions.</li><li>Combine with Other Strategies: While stop loss and take profit orders are powerful tools, they should not be used in isolation. Implement additional strategies, such as technical analysis or fundamental research, to complement your grid bot's automated trading approach.</li></ul><h2>Conclusion</h2><p>Incorporating stop loss and take profit features into your grid bot trading strategy can be a game-changer, providing a systematic approach to risk management and improving overall trading performance. By understanding the importance of these features and optimizing their implementation, you'll be better equipped to navigate the ever-changing cryptocurrency landscape and maximize your trading success.</p><p>The take profit feature allows you to secure your gains, while the stop loss limits the risk you are willing to take.</p>

In this article, we'll explore the stop loss and take profit features in grid bots, highlighting their significance and providing tips for optimizing your trading experience.

Take Profit and Stop Loss (Grid Bots)

<p>If the price moves out of the grid, the bot status changes to ‘range’ and waits indefinitely for the price to enter back in.&nbsp;</p><p>You have four possible choices:</p><ol><li>You can wait for the price to enter the grid again and do nothing else.</li><li>You can cancel the bot and use the funds for something else.</li><li>You can edit the bot configuration and cover a broader range.</li><li>You can create another bot that covers an additional price range.</li></ol><p><strong>A note for users trading on Futures</strong>: if the price moves above the upper grid level, you will have an active short position on the exchange. Likewise, if the price moves under the lower grid level, you will have an active long position on the exchange. We strongly suggest you monitor these positions closely and close them if necessary to avoid account liquidation.</p>

Learn what you can do when your bot enters "range" status.

What happens when the price is out of range?

<p>Backtesting grid bots is a crucial step in determining their performance and reliability. This article will discuss the importance of backtesting, the process of conducting backtests in Gainium, and how to evaluate their results.</p><h2>What is grid bot backtesting?</h2><p>Backtesting is the process of testing a trading strategy on past market data to check how it would have performed. This way, you can fine-tune the settings and improve their performance.</p><p>Backtesting provides several benefits, including:</p><ol><li><strong>Identifying potential flaws</strong>: Backtesting can reveal weaknesses in a grid bot's strategy, enabling traders to make necessary adjustments before using the bot in live trading.</li><li><strong>Quantifying performance</strong>: By measuring a bot's historical performance, traders can assess whether the strategy will likely be profitable.</li><li><strong>Risk management</strong>: Backtesting helps identify the risk associated with a grid bot, enabling traders to make informed decisions on capital allocation and risk tolerance.</li></ol><h2>Backtesting grid bots with Gainium</h2><p>To backtest a grid bot, navigate to the new bot page by clicking the grid bot icon in the menu and then “+ NEW.”</p><p><img src="https://back.gainium.io/uploads/new_grid_bot_ddc75c3380.png" alt="new-grid-bot.png"></p><p>Adjust the grid bot settings to your liking and perform a new backtest.</p><p><img src="https://back.gainium.io/uploads/grid_backtest_811b194779.png" alt="grid backtest.png"></p><h2>Evaluating Backtesting Results</h2><p>When analyzing the results of a backtest, it is essential to consider the following factors:</p><ul><li><strong>Market conditions</strong>: Assess the grid bot's performance across various market conditions, such as bull markets, bear markets, and periods of high volatility.</li><li><strong>Risk-adjusted returns</strong>: Evaluate the bot's performance relative to the risk involved. Metrics like the Sharpe ratio, which measures the risk-adjusted return, can help with this assessment.</li><li><strong>Robustness</strong>: A grid bot should perform consistently across different parameter settings and time frames. This indicates that the strategy is robust and not over-optimized to specific conditions.</li></ul>

Backtesting grid bots is a crucial step in determining their performance and reliability. This article will discuss the importance of backtesting, the process of conducting backtests in Gainium, and how to evaluate their results.

Backtesting grid bots

<p>Grid bots have become essential for many traders, automating buying low and selling high within a predefined price range. One powerful feature of Gainium's grid bots is the ability to set a price trigger, enabling the bot to activate only when a specific price is reached. In this article, we'll explore the concept of start price for grid bots and provide an example using the BTC-USDT trading pair.</p><h2>Understanding Start Price for Grid Bots</h2><p>A start price is a setting within grid bots that allows traders to define a specific price at which the bot becomes active. This feature provides additional control over the bot's actions, ensuring it begins trading only when the market conditions align with the trader's expectations. Key benefits of using price triggers include:</p><ul><li>Increased control over the grid bot's activation</li><li>Tailoring the bot's actions to market conditions</li><li>Enhancing the effectiveness of grid bot strategies</li></ul><p>The start price option can be found under the Strategy section of the grid bot.</p><h2>Example Using a Price Trigger with the BTC-USDT Grid Bot</h2><p>Let's dive into an example of how a price trigger can work using the BTC-USDT trading pair. For this example, assume the following:</p><ul><li>Current BTC-USDT price: $30,000</li><li>Desired price range for grid bot: $30,000 - $40,000</li><li>Grid levels: 20</li><li>Price trigger: $32,000</li></ul><figure class="image"><img src="https://back.gainium.io/uploads/grid_start_price_80215bbeb2.png" alt="grid-start-price.png"></figure><p>Here, the trader has set the price trigger to activate the grid bot when the BTC-USDT price reaches $32,000. The bot will not begin trading until the specified price is achieved. The grid bot's trading range is set between $30,000 and $40,000, with 20 grid levels evenly distributed within that range.</p><p>Once the price of BTC-USDT reaches $32,000, the grid bot will activate and start placing buy and sell orders within the defined range. If the price moves up, the bot will sell BTC for USDT; if the price drops, it will buy BTC using USDT. By utilizing the price trigger feature, the trader ensures that the grid bot only starts trading when the market conditions meet their predefined expectations.</p><h2>Conclusion</h2><p>Start price triggers for grid bots offer additional control, allowing traders to optimize their strategies and ensure that the bot activates only when the desired market conditions are met.&nbsp;</p>

Start price triggers for grid bots offer additional control, allowing traders to optimize their strategies and ensure that the bot activates only when the desired market conditions are met.

Start Price for Grid Bots

<p>Greetings, crypto enthusiasts! We are back to discuss another fascinating aspect of the digital currency landscape: Stabilization Orders in Grid Bots. This critical feature, often overlooked, plays a pivotal role in ensuring the smooth operation of grid bots and maintaining the balance of your investments.</p><p>As a refresher, let's first define grid bots. These automated trading systems follow a grid trading strategy that includes placing buy and sell orders regularly in the market. They aim to capitalize on the market's volatility, buying low and selling high. However, even with the highest level of precision these bots strive for, they are not immune to limitations and challenges. And that's where stabilization orders come in.</p><p>One of the main challenges grid bots face stems from exchange limitations that result in rounding. While this might not seem like a significant issue initially, the cumulative effect over time can lead to discrepancies between the theoretical and actual funds managed by the bot. This is akin to how small change can amount to a substantial sum when added up over time.</p><p>Stabilization orders are the solution to this conundrum. They act like a financial check and balance, mitigating these rounding discrepancies and ensuring that the theoretical funds match the actual ones. This way, stabilization orders maintain the financial equilibrium necessary for the optimal performance of your grid bot.</p><p>In addition, stabilization orders also come into play when the grid bot misses an order due to rapid price fluctuation, system errors, or other unpredictable factors. In such scenarios, stabilization orders act as a safeguard, ensuring that the missed order doesn't disrupt the functioning of the bot and the grid trading strategy.</p><p>It's essential to understand that stabilization orders are not anomalies or something to be worried about. Rather, they are a standard part of the grid bot’s function, a testament to the sophisticated design of these bots. They are part and parcel of the bot's effort to stay in step with the dynamic nature of cryptocurrency markets.</p><p>Moreover, it's worth noting that stabilization orders are accounted for in the bot's Profit and Loss (P&amp;L) calculations. This means they're not hidden or unexpected charges but a transparent part of the overall trading performance.</p><figure class="image"><img src="https://back.gainium.io/uploads/stabilization_order_0378a44874.png" alt="stabilization-order.png"><figcaption>Stabilization order</figcaption></figure><h2>Example: BTC/USDT grid bot</h2><p>Let's dive into the volatile world of Bitcoin (BTC) and Tether (USDT) trading to understand how stabilization orders work in action.</p><p>Imagine you've set up a grid bot to trade BTC/USDT. The bot operates within a predefined price range, with sell orders placed at regular intervals above the current price and buy orders placed at regular intervals below. This grid spans $30,000 (lowest buy order) to $40,000 (highest sell order) and comprises 100 grids, each representing a $100 price difference.</p><p>Suppose the bot makes its first transaction, purchasing 0.01 BTC for $30,000. However, due to its rounding policy, the exchange platform rounds down the USDT value of this transaction to $29,999.95. Although this seems like a negligible difference, over hundreds of trades, the impact accumulates, creating a disparity between the bot's theoretical and actual funds.</p><p>Fast forward a few days and BTC's price sees a rapid surge, jumping from $33,000 to $35,000 in a matter of minutes. This unexpected spike causes the bot to miss a sell order at $34,500. This miss can create further discrepancies in the bot's trading calculations and impact the total profit made from the grid trading strategy.</p><p>In both situations, a stabilization order is essential. To address the rounding difference, the bot might trigger a stabilization order to purchase additional BTC with the 'extra' USDT, thus realigning the theoretical and actual funds. In the case of the missed sell order, the bot might implement a stabilization order to sell the previously purchased BTC at the new market price of $35,000. This step ensures that the trading strategy remains intact and the profit is maximized according to market conditions.</p><h2>Conclusion</h2><p>In summary, stabilization orders serve as an integral feature in the operation of grid bots. They rectify rounding discrepancies, compensate for missed orders, and bridge the gap between theoretical and actual funds, ensuring a smooth trading experience. So, the next time you notice a stabilization order in your transaction history, rest easy knowing it's just your grid bot doing its job, helping you navigate the ever-turbulent seas of cryptocurrency trading.</p>

Stabilization orders are a fundamental part of grid bot operations that help match discrepancies between theoretical and actual funds. In this article, we explain how they work.

Stabilization orders (Grid)

<p>Today, we will address a topic that often puzzles many of our esteemed clients - how our advanced grid bots calculate profits.</p><p>At Gainium, we believe that transparency is essential for trust. As such, it's our pleasure to walk you through how our grid bot profits are computed.</p><p>When discussing grid trading in the cryptocurrency world, platforms typically use one of two methods to calculate grid bot profits. The first method counts profits only when there is a match for both buy and sell orders, ignoring those without a match. On the other hand, the second method counts profits when there is a match for buy and sell orders, and those unmatched orders are matched to the initial price of the token. The initial price of the token defaults to the token's purchased price (if the bot purchased it) or the token's price when the bot was started (if you used your token's balance).&nbsp;</p><p>Whether counting unmatched orders or not, the exchange fees are considered in both cases, so you don't have to worry about that.</p><p>At Gainium, we utilize the latter method - not only counting matched buy and sell orders but also including unmatched orders matched to the initial price of the token. This method provides a comprehensive view of the trading situation, ensuring every transaction, matched or unmatched, is accounted for in the profit calculation.</p><h2>Example: ETH/USD grid</h2><p>Assume we set up an ETH/USD grid bot with a budget of $500 and a range of $1,000 to $1,500, with 5 grids each spaced $100 apart. The current price of ETH is $1,000, hence we buy 0.5 ETH (0.1 ETH each grid order). The bot will place 5 sell orders within this range. Each grid, therefore, represents a $100 price change in ETH/USD. Let's ignore exchange fees for the sake of simplicity.</p><p><img src="https://back.gainium.io/uploads/eth_usd_grid_fe800f2288.png" alt="eth-usd-grid.png"></p><p>As you can see from the image above, orange triangles are unmatched sell orders, which we match to the initial price of $1,000. This way, the total profit for this grid is $180.</p><p>This approach reflects a comprehensive profit calculation, accounting for the grid's efficiency and unmatched orders that might be overlooked.</p><p>It's worth noting that the Gainium grid bot strategy is designed to perform best in a volatile market where the price of a trading pair fluctuates within a specific range. The unmatched order profits help in maximizing gains in these volatile market conditions.</p><p>We hope this article provides a clear understanding of how Gainium's grid bot calculates profits. As always, our team is available to answer any queries regarding our trading platform. Happy trading!</p>

Learn how we calculate grid bot profits at Gainium.

Understanding how grid bots calculate profit

<h2>Introduction</h2><p>In cryptocurrency trading, grid trading has emerged as a strategy embraced by traders to capitalize on market volatility. By setting predefined buy and sell orders at different price levels, grid trading allows for systematic profit generation in fluctuating market conditions. Yet, while the strategy remains consistent, the application can differ based on the market type—spot or futures. Understanding the nuances between grid trading in spot markets versus futures markets is crucial for traders looking to maximize their returns and navigate potential pitfalls. This article will delve into the foundational differences between these two markets, demystifying the complexities and offering insights for informed trading decisions.</p><h2>1. Understanding the Basics</h2><h3>1.1. What is Spot Trading?</h3><p>Spot trading, in its essence, refers to the immediate exchange of assets. When you engage in spot trade, you purchase or sell the asset, such as a cryptocurrency, and the transaction is settled "on the spot." This direct transaction means you either hand over the funds and receive the asset or vice versa. The primary characteristics of spot trading are:</p><ul><li><strong>Immediate Settlement</strong>: Unlike other trading forms, spot trades are settled instantly. When you buy a cryptocurrency in a spot market, it is deposited into your wallet immediately upon completion of the transaction.</li><li><strong>Direct Ownership</strong>: Upon a successful trade, you directly own the asset. In the case of cryptocurrencies, this means having possession of the actual coins or tokens.</li><li><strong>No Leverage</strong>: Typically, spot trading doesn't involve borrowing and hence doesn't offer leverage. Your trade is limited to the capital you have.</li></ul><h3>1.2. What is Futures Trading?</h3><p>On the other hand, futures trading doesn't involve the immediate exchange of assets. Instead, it's based on contracts that commit the buyer to purchase and the seller to sell a specified amount of an asset at a predetermined price on a set future date. Key features of futures trading include:</p><ul><li><strong>Standardized Contracts</strong>: Futures contracts are standardized in quantity, quality, delivery time, and place for the underlying asset.</li><li><strong>Leverage</strong>: Futures trading often involves leverage, allowing traders to open positions much larger than their capital. This can amplify both profits and potential losses.</li><li><strong>No Direct Ownership</strong>: One does not own the underlying asset when trading futures. Instead, they enter into a contract representing the asset to settle later.</li><li><strong>Settlement</strong>: While some futures contracts might settle in the actual asset, many settle in cash, meaning traders won't receive the underlying asset but the difference between the purchase price and the asset's price at the contract's expiry.</li></ul><p>With these foundational concepts clarified, we can dive deeper into how grid trading uniquely functions within these market structures.</p><h2>2. Core Differences Between Spot and Futures in Grid Trading</h2><h3>2.1. Trading Mechanism</h3><p><strong>Spot</strong>: The primary mechanism in spot grid trading is straightforward. Traders set up multiple buy and sell orders at predetermined intervals. As prices fluctuate, these orders get executed, generating profit from the price differences.</p><p><strong>Futures</strong>: In futures, the mechanism incorporates the essence of contracts. While grid levels can still be set, traders must be cognizant of the contract's expiry date and potential liquidations due to the leverage used. Orders may not necessarily lead to asset ownership but might settle in cash or roll over to another contract.</p><h3>2.2. Risk Profile</h3><p><strong>Spot</strong>: The risks in spot grid trading are mainly related to market volatility. Since there's no leverage involved, traders risk what they put in and not more.</p><p><strong>Futures</strong>: Futures grid trading carries additional risks, most notably liquidation. Due to leverage, if the market moves significantly against a trader's position, they could lose their initial margin and face a liquidation event. Additionally, traders must be wary of funding rates that could benefit or cost them depending on market conditions. As grid trading typically involves keeping a position open longer, these fees can be significant.</p><h3>2.3. Profit Potential</h3><p><strong>Spot</strong>: Profits in spot grid trading come from capitalizing on the asset's price movements within the grid. Since there's no leverage, gains and losses are more linear.</p><p><strong>Futures</strong>: With leverage, profits in futures grid trading can be magnified. This means even small price movements can lead to significant gains. However, the same applies to losses, making it a double-edged sword.</p><h3>2.4. Cost Implications</h3><p><strong>Spot</strong>: The primary costs in spot trading revolve around trading fees, which can either be a flat fee or a percentage of the transaction value.</p><p><strong>Futures</strong>: Apart from trading fees, futures traders must account for funding rates. Depending on their position (long or short) and the market's direction, traders might either receive or pay funding.</p><h3>2.5. Contract Expiry</h3><p><strong>Spot</strong>: Spot trades don't come with an expiry date. Once you own the asset, it remains with you until you decide to sell.</p><p><strong>Futures</strong>: Traditional futures contracts typically have a predetermined expiry. As this date approaches, traders need to decide whether to roll over their positions to a new contract or close them. However, cryptocurrency exchanges typically offer perpetual futures contracts with no expiry date.</p><h2>3. Advantages of Grid Trading in Each Market</h2><h3>3.1. Spot Market</h3><ul><li><strong>Simplicity</strong>: Spot trading is generally more straightforward than futures, making it easier for beginners.</li><li><strong>Direct Ownership</strong>: Being the actual holder of the asset provides more control and flexibility, especially regarding long-term holding or utilizing the asset in other ways, like staking.</li><li><strong>No Expiry Worries</strong>: Without contract expiries, traders can set their grid and let it operate without needing continuous monitoring and adjustments related to contract durations.</li></ul><h3>3.2. Futures Market</h3><ul><li><strong>Leverage</strong>: This can be a significant advantage for those with limited capital but a strong market understanding. It allows for larger positions and potentially greater profits.</li><li><strong>Profit in Various Market Conditions</strong>: Futures allow traders to easily take both long and short positions, enabling them to potentially profit in both rising and falling markets.</li><li><strong>Hedging Opportunities</strong>: Experienced traders can use futures to hedge positions, providing a safety net against unfavorable market moves.</li></ul><p>Both spot and futures markets offer unique advantages, and the choice between them often boils down to individual trading goals, risk appetite, and market outlook.</p><h2>4. Understanding Shorting in Spot vs Futures</h2><h3>4.1. Shorting in Spot Markets</h3><p><strong>Mechanism</strong>: Shorting in the spot market typically involves borrowing an asset to sell it at the current price, hoping to repurchase it later at a lower price to profit from the price difference. Traders wanting to short in the spot market must own the asset they wish to short. Alternatively, they may be able to borrow the asset in exchanges that offer lending services.</p><p><strong>Limitations</strong>: Shorting in spot markets involving borrowed assets is not as straightforward as in futures. There's the need for a lending facility, potential borrowing fees, and the risk of being forced to cover the short if the lender recalls their asset.</p><p><strong>Potential Drawbacks</strong>: This will be different if it involves direct ownership or borrowed assets. In both cases, if the asset's price rises, the trader misses the increase in value. The difference is that in direct ownership, the trader can choose whether to repurchase the asset at a higher value. In the case of borrowed assets, the trader traders may incur significant losses, especially if the asset's price rise is sharp and prolonged. Furthermore, borrowing fees can accumulate over time, especially if the short position is held for an extended period.</p><h3>4.2. Shorting in Futures Markets</h3><p><strong>Mechanism</strong>: Shorting is inherently built into futures trading. When you sell a futures contract, you're essentially taking a short position, anticipating a decrease in the asset's price. There's no need to borrow the asset; you're simply entering a contract that commits to selling at a specified future date.</p><p><strong>Advantages</strong>: Futures markets offer a more streamlined approach to shorting without the complexities of borrowing. Moreover, traders can utilize leverage to amplify potential profits, increasing risk.</p><p><strong>Challenges</strong>: Just as with going long, shorting with futures carries the risk of liquidation if the market moves against the trader's position. Additionally, funding rates can vary, which might cost or benefit the trader, depending on market sentiment.</p><h3>4.3. Liquidation Risks</h3><p><strong>Spot</strong>: While the risk of liquidation in spot shorting is minimal, a sharp rise in the asset's price can lead to significant losses, potentially leading traders to sell other assets to cover the loss.</p><p><strong>Futures</strong>: Due to the inherent leverage in futures contracts, traders can face liquidation if the market moves against their position and their margin balance falls below the maintenance margin. Regular monitoring and the use of stop orders can help mitigate this risk.</p><h2>5. Challenges and Considerations in Grid Trading</h2><h3>5.1. Market Volatility</h3><p><strong>Spot</strong>: Extreme volatility can cause rapid and substantial price swings. In a highly volatile market, the price might skip several grid levels, potentially leading to missed profit opportunities. In Gainium we handle such scenarios with <a href="https://gainium.io/help/stabilization-orders-grid">stabilization orders</a>.</p><p><strong>Futures</strong>: Volatility in futures can be even more pronounced due to the effect of leverage. Sudden price movements can lead to immediate liquidations.</p><h3>5.2. Strategy Adjustments</h3><p><strong>Spot</strong>: Spot grid strategies might need adjustments based on changing market conditions. For instance, traders might re-evaluate grid levels in a prolonged bull market to capitalize on higher price levels.</p><p><strong>Futures</strong>: Given the added dimension of contract expiry and potential liquidation, futures grid strategies might require more frequent adjustments. Monitoring funding rates, considering rollover dates, and being wary of extreme volatility are essential considerations.</p><h3>5.3. Monitoring and Maintenance</h3><p><strong>Spot</strong>: While one of the advantages of grid trading is a somewhat "set it and forget it" approach, periodic monitoring is still crucial. Checking the effectiveness of grid levels and ensuring they align with the current market sentiment can enhance profitability.</p><p><strong>Futures</strong>: Continuous oversight is even more crucial in futures due to the added complexities of leverage, funding rates, and contract expiries. Regularly reviewing the strategy and making necessary adjustments can help optimize returns and minimize risks.</p><p>In summary, while grid trading presents opportunities in both spot and futures markets, each has unique advantages and challenges. Traders need to have a thorough understanding of their chosen market to navigate it effectively.</p><h2>6. Gainium's Unique Offerings for Grid Traders</h2><h3>6.1. Intuitive Smart Trading Terminal</h3><p>Gainium provides an advanced yet user-friendly trading terminal, streamlining the process of setting up grid trading strategies. With visual aids, real-time data, and a sleek interface, users can efficiently map out their grid levels, regardless of their expertise.</p><h3>6.2. Backtesting and Paper Trading Capabilities</h3><p>Before deploying real capital, Gainium users can test their grid trading strategies using the platform's backtesting tool. This allows for risk-free testing against historical data to gauge potential profitability. Paper trading offers a live simulation, helping traders gain confidence without financial risk.</p><h3>6.3. Automated Grid Trading Bots</h3><p>Gainium offers a suite of trading bots designed explicitly for grid strategies. Users can customize their grid parameters, and the bot will manage buying and selling automatically based on those settings, ensuring 24/7 trading without manual oversight.</p><h3>6.4. Community Knowledge and Engagement</h3><p>Harnessing the power of collective intelligence, Gainium provides a platform for traders to collaborate, share insights, and learn from one another. This community-driven approach ensures traders stay updated with the latest strategies, tweaks, and market sentiments relevant to grid trading.</p><h3>6.5. Real-time Crypto Market Screener</h3><p>To make informed decisions, Gainium's market screener offers recent data on crypto market movements. Traders can identify potential entry and exit points, detect emerging trends, and optimize their grid levels based on live market conditions.</p><h3>6.6. News and Sentiment Analysis</h3><p>Given the crypto market's sensitivity to news events, Gainium incorporates a feature that curates and analyzes the latest industry news. This ensures that grid traders can quickly adapt their strategies to market-moving news.</p><h2>Conclusion</h2><p>With its systematic approach to capitalizing on market volatility, grid trading offers both opportunities and challenges. While the strategy's fundamentals remain consistent, its application varies considerably between spot and futures markets. Understanding these nuances and leveraging platforms like Gainium can significantly elevate a trader's success. Gainium, with its blend of cutting-edge technology and community-driven insights, serves as an indispensable tool for novice and seasoned grid traders, providing a comprehensive ecosystem to navigate the complexities of the crypto market effectively.</p>

Differences of Grid Trading in Spot vs Futures

<p>The world of cryptocurrency trading is dynamic, and automated trading solutions have emerged to help traders optimize their strategies. One such solution is the reverse grid crypto trading bot. This article will delve into what a reverse grid bot is, how it's different from its counterpart—the long grid bot—and how to effectively use it.</p><h2><strong>Advantages of Grid Trading</strong></h2><p>Grid trading, whether it's a long or short strategy, has become one of the most popular automated trading strategies in the world of cryptocurrencies. Here are some notable advantages:</p><ol><li><strong>Automated and Passive:</strong>&nbsp;Once set up, grid trading bots operate autonomously, allowing traders to earn potential profits without constant price monitoring. This offers a more passive approach to trading.</li><li><strong>Adaptable to Sideways Markets:</strong>&nbsp;While many trading strategies thrive during bullish or bearish trends, grid trading can be especially effective in sideways or range-bound markets, capturing profits from minor price fluctuations.</li><li><strong>Diversified Entry and Exit Points:</strong>&nbsp;Instead of trying to identify a single optimal buy or sell point, grid trading distributes orders across multiple price levels, diversifying entry and exit points and reducing the impact of poor timing.</li><li><strong>Risk Management:</strong>&nbsp;By dividing the capital into multiple orders, grid trading can prevent pouring all funds into a less favorable position. This spread reduces the impact of any single bad trade.</li><li><strong>No Need for Predictive Analysis:</strong>&nbsp;Predicting the market's next move can be challenging. With grid trading, there’s no need to predict long-term price movements accurately. As long as the price remains within the grid range, the strategy can be profitable.</li><li><strong>Hedging Capabilities:</strong>&nbsp;By employing both long and short grid strategies simultaneously, traders can hedge their positions, potentially profiting from both upward and downward price movements.</li><li><strong>Compounding Profits:</strong>&nbsp;Grid trading allows for the reinvestment of profits. As trades are executed, the generated profits can be reinvested, allowing for potential compound growth.</li><li><strong>Flexibility:</strong>&nbsp;Grid parameters, like grid size and spacing, can be adjusted according to the trader's preferences and price volatility, making it a versatile tool for various market conditions.</li><li><strong>Reduced Emotional Trading:</strong>&nbsp;Emotional decisions can often result in trading mistakes. Grid trading, being automated, removes the emotion from the equation, leading to more rational and systematic trading decisions.</li><li><strong>Time Efficiency:</strong>&nbsp;For those who can't dedicate their entire day to the markets, grid trading bots provide an efficient way to participate without the need for constant oversight.</li></ol><p>While grid trading presents several advantages, it’s important to note that no strategy is foolproof. It's essential to understand the mechanism, risks involved, and market conditions suitable for the grid strategy method before diving in. Properly configured and monitored, grid trading can be a valuable tool in a crypto trader’s arsenal.</p><h2><strong>What is a Reverse Grid trading bot?</strong></h2><p>A reverse grid trading bot, often referred to as a short grid bot, is an automated trading strategy designed for the cryptocurrency market. Unlike the traditional approach where a trader buys low and sells high, the reverse grid technique involves selling a cryptocurrency first, then repurchasing it as the price drops. The strategy is designed to capitalize on declining markets, aiming to buy back the asset for less than it was initially sold for, thereby making a profit.</p><h2><strong>Difference Between Long and Reverse Grid Bot</strong></h2><p>The primary difference between a long grid bot and a reverse grid bot lies in their initial actions and profit-counting mechanisms.</p><p><strong>Initial Action:</strong></p><ul><li><i>Long Grid Bot:</i>&nbsp;Starts by buying the base currency and sells portions of it as the currency price rises.</li><li><i>Reverse Grid Bot:</i>&nbsp;Begins by selling the base currency and repurchases it as the currency price drops.</li></ul><p><strong>Profit Counting:</strong></p><ul><li><i>Long Grid Bot:</i>&nbsp;Profit is counted on every sell order, since the asset is initially purchased and then sold at higher price points.</li><li><i>Reverse Grid Bot:</i>&nbsp;Profit is counted on every buy order, as the asset is first sold and then repurchased at lower price points.</li></ul><h2><strong>When to Use a Reverse Grid Bot</strong></h2><p>A reverse grid bot is most effective during bear market conditions or when a trader anticipates a decline in the price of a cryptocurrency. When there's an expectation that the price will fall, the reverse grid bot can capitalize on this downtrend by selling the asset at current prices and repurchasing it at reduced rates.</p><h2><strong>How to Set Up a Reverse Grid Bot on Gainium</strong></h2><p>Setting up a reverse grid bot on Gainium involves several steps:</p><ol><li><strong>Registration:</strong>&nbsp;If you're not already registered, sign up on the Gainium platform.</li><li><strong>Select Bot Type:</strong> choose 'Grid Bot'.</li><li><strong>Configuration:</strong>&nbsp;Determine the price range for your trading, set the price interval, grid levels, arithmetic grid or geometric grid type, and allocate budget. The only requisite to make a reverse grid bot is to set the direction to short; however, many traders also set the profit currency to base, hence accumulating more base coin.</li><li><strong>Activate the Bot:</strong>&nbsp;Once set up, click on “Add new bot” and start your bot. It will begin trading based on the parameters you've set.</li></ol><p>Note that you will need to have the base token available in your balance for the bot to start.</p><p><img src="https://back.gainium.io/uploads/Reverse_grid_798ecb3b3c.jpeg" alt="Reverse-grid.jpeg"></p><h2><strong>Example of Reverse Grid Using BTC-USDT</strong></h2><p>Imagine BTC is trading at 40,000 USDT and you anticipate a decline in price.</p><ol><li>You set up your reverse grid bot to start selling BTC and establish 10 grid levels down to 35,000 USDT.</li><li>The bot sells BTC at 40,000 USDT.</li><li>As the price of BTC falls, the bot sets buy orders at 39,500, 39,000, and so on, down to 35,000 USDT.</li><li>If the price drops to 35,500 USDT and then rebounds, the bot would have repurchased BTC at each level on the way down, realizing a profit on every buy order.</li></ol><h2><strong>Reverse Grid FAQ</strong></h2><p><strong>Q: Can I use both long and short grid bots simultaneously?</strong></p><p><i>A:</i>&nbsp;Yes, some traders use both types to hedge their positions and capitalize on both rising and falling markets.</p><p><strong>Q: What are the risks associated with using a reverse grid bot?</strong></p><p><i>A:</i>&nbsp;Like all trading strategies, there's no guarantee of profit. If the market unexpectedly rises after you've started the bot, it might result in a loss.</p><p><strong>Q: How often should I monitor my reverse grid bot?</strong></p><p><i>A:</i>&nbsp;While the bot automates trading, regular check-ins are advised to adjust parameters in line with changing market conditions.</p><p>In conclusion, reverse grid bots offer a distinct strategy for traders looking to benefit from declining markets. However, understanding the mechanism and market conditions is crucial before leveraging such tools.</p>

Explore the intricacies of the reverse grid crypto trading bot. Dive deep into its advantages, compare it with long grid bots, and learn its optimal setup and use cases.

Reverse Grid

Grid Bots

Fix common problems with your exchange or API connection.

Exchange API.svg

<p>Gainium uses APIs to connect to your exchange and make trades. In this article, we will show you how to generate an API key in Binance and connect your account to Gainium. Let's do it!&nbsp;</p><h2>Step 1 - Open Binance Dashboard</h2><p>Switch to the new browser tab, log in, or create a new account on <a href="https://binance.com/"><i>https://binance.com/</i></a>.&nbsp;</p><h2>Step 2 – Find "API Management" in Binance</h2><p>Move your cursor over the profile icon in the upper right corner and choose "API Management." &nbsp;</p><p><img src="https://back.gainium.io/uploads/API_management_7ed61dd841.webp" alt="API management.webp"></p><h2>Step 3 - Create API</h2><p><img src="https://back.gainium.io/uploads/API_type_68a94e277b.png" alt="API-type.png"></p><h2>Step 4 – Label/Name Your Key</h2><p>When you have several APIs, having a proper name makes it easier to manage them. Name your key (for example, Gainium.io) and then click "Create."&nbsp;</p><p><img src="https://back.gainium.io/uploads/Label_API_fc6154cca2.webp" alt="Label API.webp"></p><p>Security tip: Enable <a href="https://academy.binance.com/en/articles/binance-2fa-guide">two-factor authentication</a> (2FA) on your account before creating an API.&nbsp;</p><h2>Step 5 - Enter 2FA Codes&nbsp;</h2><p>After clicking the "Create" button, you will be asked to enter 2FA codes.&nbsp;</p><p><img src="https://back.gainium.io/uploads/Security_c28ef61c77.webp" alt="Security.webp"></p><p>Your API has now been created. <strong>Please keep your Secret Key safe since it will not be shown again. </strong>This key shouldn't be shared with anyone else. You must remove and recreate the API if you lose your Secret Key.&nbsp;</p><h2>Step 6 - Edit the API Restrictions</h2><p>Click on “Edit restrictions”.</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_08_02_19_14_17_981f9c30be.png" alt="Screenshot 2023-08-02_19-14-17.png"></figure><p>Then, click on “Restrict access to trusted IPs only (Recommended)” and input the following IPs:&nbsp;</p><p>78.128.60.89 78.128.43.82 78.128.8.36</p><p>Then click on “Confirm”.</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_08_02_19_15_21_cc679215cc.png" alt="Screenshot 2023-08-02_19-15-21.png"></figure><p>Once you are done with that step, you can check the boxes as per the screenshot below and click on the “Save” button.</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_08_02_19_17_44_1e7f993b5c.png" alt="Screenshot 2023-08-02_19-17-44.png"></figure><h2>Step 6.b (Optional) Enable Symbol Whitelist</h2><p>If you only trade specific token pairs, you can enhance the security of your API keys even further by activating token symbol whitelist. This will prevent a hacking technique known as “Contra trading”. Contra trading is a market manipulation tactic by which a hacker generates enough trading volume to move the market in their desired direction and profit from that move. Generally, it involves lower cap tokens, as they require less volume to produce price movements. Enabling Symbol Whitelist will prevent hackers from using such tactics with your API keys.</p><p><img src="https://back.gainium.io/uploads/Screenshot_2023_08_02_19_16_49_0017709544.png" alt="Screenshot 2023-08-02_19-16-49.png"><img src="https://back.gainium.io/uploads/Screenshot_2023_08_02_19_18_19_b6fe71d6eb.png" alt="Screenshot 2023-08-02_19-18-19.png"></p><h2>Step 7 – Connecting Gainium to Binance&nbsp;</h2><p>Login to the dashboard of gainium.io and click on the Exchanges icon, then “Add new”.</p><p><img src="https://back.gainium.io/uploads/gainium_add_exchange_c55c474ea1.png" alt="gainium-add-exchange.png"></p><p>On the pop-up window, make sure that you have selected “Real” exchange. Then select the kind of exchange from the dropdown menu, paste your API key, Secret key, and click “Add exchange”.&nbsp;</p><p><img src="https://back.gainium.io/uploads/add_binance_80b2749c29.png" alt="add-binance.png"></p><p>Wait a few seconds for the system to retrieve your Binance account data.</p><p>That's it! Your Gainium account is now connected to Binance.</p><p><img src="https://back.gainium.io/uploads/binance_9db281e0cb.png" alt="binance.png"></p>

Connect to Binance

<p>At Gainium, we don't limit the number of exchanges you can add. You can also add unlimited accounts per exchange. However, please consider that an account can only be added once.</p>

Learn about the limitations for the number of exchanges on our platform.

How many exchanges can I add?

<p>When you use a crypto exchange, it is important to make sure that you take all necessary precautions to avoid being hacked.</p><p>Many trading platforms claim API keys are safe because they do not have withdrawal rights. While it's true that a potential hacker cannot directly withdraw funds to another wallet using your API keys, there is still a risk that they can be used for a technique called “contra trading.” Contra trading is a market manipulation tactic by which a hacker generates enough trading volume to move the market in their desired direction and profit from that move. Generally, it involves lower cap tokens, as they require less volume to produce price movements.&nbsp;</p><p>By following the steps below, you can dramatically lower the chances of your account potentially being controlled by a malicious actor.</p><h2>Steps to protect yourself from hackers</h2><h3>2-Factor Authentication</h3><p>Activating 2FA on the exchange and Gainium is the first step to safeguard access to your API keys. This is a standard security practice; however, hackers can sometimes find security holes in the platforms and access the database directly. That's why it's important to take additional security measures so that in the event that a hacker manages to obtain your API keys, they would be rendered useless anyway.</p><h3>Exchange API key IP whitelist</h3><p>Exchanges usually allow extra security measures to ensure your API keys are safe. One of such measure is IP whitelisting. By allowing only certain IPs to use the API key, you can ensure that they will not work even if they were leaked. Remember that the IP to whitelist is not your computer IP, but the IP of Gainium's server, which connects to the exchange. During API creation, enable IP whitelisting and add Gainium's server IP:&nbsp;</p><p><strong>78.128.60.89</strong><br><strong>78.128.43.82</strong><br><strong>78.128.8.36</strong></p><h3>Exchange API key token symbol whitelist</h3><p>If you only trade specific token pairs, you can enhance the security of your API keys even further by activating token symbol whitelist. Remember that contra trading usually involves obscure tokens with lower market cap, as they are easier to produce price movements.&nbsp;</p><p><img src="https://back.gainium.io/uploads/API_whitelist_8aa05079fe.png" alt="API whitelist.png"></p><p>By taking the above steps, you will ensure that your account stays protected from hackers.</p>

In this article we explain the steps you can take to increase the security of your account and your exchange API keys.

Enhancing security of your exchange API keys

<h2>How to connect Gainium to Bybit</h2><p><strong>1. Log in to Bybit and go to the API Keys Page</strong>&nbsp;</p><p>Once you have logged into your Bybit account, hover on “My Account” on the top right and select the account you want to use to create API keys (Bybit allows the creation of subaccounts).&nbsp;</p><p>Then click on API.</p><figure class="image image_resized" style="width:55.84%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_03_30_at_18_15_42_98735fe6f9.png" alt="Screenshot 2023-03-30 at 18.15.42.png"><figcaption>Login</figcaption></figure><p><strong>2. Click on the “Create New Api” orange button</strong>&nbsp;</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_03_30_at_18_46_34_b5cf2ceb60.png" alt="Screenshot 2023-03-30 at 18.46.34.png"><figcaption>Click New Key</figcaption></figure><p><strong>3. Select the first option: System-generated API Keys&nbsp;</strong></p><figure class="image image_resized" style="width:58.68%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_03_30_at_18_09_14_ea31cb77a3.png" alt="Screenshot 2023-03-30 at 18.09.14.png"><figcaption>System-generated API Keys</figcaption></figure><p><strong>4. Fill in the Create New Key Page</strong></p><p>API KEY USAGE</p><ul><li>Leave API Transaction checked and name the API key</li></ul><p>API KEY PERMISSIONS</p><ul><li>Select “Read-Write”</li><li>Select “Only IPs with permissions granted are allowed to access the OpenAPI” (please read the documentation regarding API Key security <a href="https://gainium.io/help/enhancing-security">here</a>, where you can also find the IP addresses to fill in the form)</li><li>Tick “Trade” permission on the Spot type and then click “Submit”.</li></ul><p><img src="https://back.gainium.io/uploads/Screenshot_2023_03_30_at_18_25_44_5528a9826f.png" alt="Screenshot 2023-03-30 at 18.25.44.png"></p><p><img src="https://back.gainium.io/uploads/Screenshot_2023_03_30_at_18_27_14_ee86141375.png" alt="Screenshot 2023-03-30 at 18.27.14.png"></p><p><strong>5. Enter the codes for Security Verification&nbsp;</strong></p><figure class="image image_resized" style="width:50.72%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_03_30_at_18_27_48_d78eafc697.png" alt="Screenshot 2023-03-30 at 18.27.48.png"><figcaption>Security Verification</figcaption></figure><p><strong>6. Copy the Key and Secret Key</strong></p><p>Once you have passed security verification, you will receive your keys.&nbsp;</p><p>Store the API secret in a safe place, as you will only see them on the screen once at this stage.&nbsp;</p><figure class="image image_resized" style="width:50.59%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_03_30_at_18_29_01_b78bfb9090.png" alt="Screenshot 2023-03-30 at 18.29.01.png"><figcaption>API KEYS</figcaption></figure><p><strong>7. Paste the keys in Gainium</strong></p><ul><li>Open the <a href="https://app.gainium.io/exchanges">Exchanges</a> page in Gainium and click on the “Add New” orange tab at the top of the page.</li><li>&nbsp;Fill in the information in the Add New exchange popup.</li><li>Click on the “Add Exchange” orange tab</li></ul><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_03_30_at_19_28_37_0bd61e6261.png" alt="Screenshot 2023-03-30 at 19.28.37.png"></figure><figure class="image image_resized" style="width:50.75%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_03_30_at_18_30_32_dc7f6dadeb.png" alt="Screenshot 2023-03-30 at 18.30.32.png"><figcaption>Add New Exchange</figcaption></figure><p>You are all set! The newly added exchange will now show up.</p><p>&nbsp;</p>

This guide will walk you through step by step how to connect Bybit to Gainium

Connect to Bybit

<h2>How to connect Gainium to Kucoin</h2><p><strong>1. Log in to Kucoin and go to the API Keys Page</strong>&nbsp;</p><p>Once you have logged into your Kucoin account, hover on “My Account” on the top right and click on API management. (Kucoin allows the creation of a subaccount, to create API for the subaccount, you need to select the subaccount first).&nbsp;</p><p>Then click on API.</p><figure class="image image_resized" style="width:54.09%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_03_30_at_19_38_53_2251ade3b5.png" alt="Screenshot 2023-03-30 at 19.38.53.png"><figcaption>Login</figcaption></figure><p><strong>2. Click on the “Create API” green button</strong>&nbsp;</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_03_30_at_19_39_13_17c7bf0238.png" alt="Screenshot 2023-03-30 at 19.39.13.png"><figcaption>Api Management page</figcaption></figure><p><strong>3. Fill in the Create API page</strong></p><ul><li>Complete the “API Name” and “API Passphrase” fields</li><li>The following section is greyed out by default</li><li>Tick the "Trade" option&nbsp;</li><li>Tick the “IP Restriction”, (please read the documentation regarding API Key security <a href="https://gainium.io/help/enhancing-security">here</a>, where you can also find the IP addresses to fill in the form)</li><li>Click “Next” and complete the image caption popup</li></ul><figure class="image image_resized" style="width:50.33%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_03_30_at_19_41_44_1e3e8a1c9b.png" alt="Screenshot 2023-03-30 at 19.41.44.png"><figcaption>Create API</figcaption></figure><p>&nbsp;</p><p><strong>5. Complete the email verification</strong></p><p>Once you have completed step 4, you will need to activate your API by clicking “Activate API” from your mailbox.</p><figure class="image image_resized" style="width:65.38%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_03_30_at_19_44_11_f331376de9.png" alt="Screenshot 2023-03-30 at 19.44.11.png"><figcaption>Verification</figcaption></figure><figure class="image image_resized" style="width:49.7%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_03_30_at_19_45_02_632f6399ee.png" alt="Screenshot 2023-03-30 at 19.45.02.png"><figcaption>Activate API</figcaption></figure><p><strong>6. Copy the Key and Secret Key</strong></p><p>Once you have passed the email security verification, you will receive your keys.</p><p>Store the API secret in a safe place, as you will only see them on the screen once at this stage.&nbsp;</p><figure class="image image_resized" style="width:50%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_03_30_at_19_45_29_abff449388.png" alt="Screenshot 2023-03-30 at 19.45.29.png"><figcaption>API Created</figcaption></figure><p>&nbsp;</p><p><strong>7. Paste the keys in Gainium</strong></p><ul><li>Open the <a href="https://app.gainium.io/exchanges">Exchanges</a> page in Gainium and click on the “Add New” orange tab at the top of the page.</li><li>&nbsp;Fill in the information in the Add New exchange popup.</li><li>Click on the “Add Exchange” orange tab</li></ul><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_03_30_at_19_28_37_0bd61e6261.png" alt="Screenshot 2023-03-30 at 19.28.37.png"></figure><figure class="image image_resized" style="width:50.05%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_03_30_at_19_48_41_025d218ce8.png" alt="Screenshot 2023-03-30 at 19.48.41.png"><figcaption>Add New Exchange</figcaption></figure><p>You are all set! The newly added exchange will now show up.</p><p>&nbsp;</p><p>&nbsp;</p>

This guide will walk you through step by step how to connect Kucoin to Gainium

Connect to Kucoin

Exchanges and APIs

Resolve common issues related to your account.

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<p>If you are not receiving emails from the platform, there is a big chance that your email provider is mistakenly marking our emails as spam. To address the issue, please log in to your webmail interface and search for “gainium.io”.&nbsp;</p><p><strong>Note for Gmail users</strong>: Google may not display search results from spam, so you must navigate directly to your <a href="https://mail.google.com/mail/u/0/#spam">spam folder</a> and perform the search there.&nbsp;</p><p>To ensure future email deliverability, please add gainium.io to your whitelist.</p><p>If this doesn't solve your issue, don't hesitate to contact us, and we will do our best to help.</p>

Here is what you can do when you are not receiving any emails from us.

Not receiving emails from Gainium

<p>Two-factor authentication (2FA) is an additional layer of security that requires users to provide two different authentication factors when logging into Gainium. This means that users must use their password and another security token, such as a code sent to their phone or a token displayed on a 2FA app.</p><p>Users should set up Two-Factor Authentication and install an authentication app on their mobile devices.</p><p>Recommended Authenticator Apps:</p><ul><li><strong>Google Authenticator</strong>. Unless you want to store all your codes offline, we recommend using Google Authenticator as your go-to 2FA app. Losing access to authentication would be a nightmare, so it's essential to have a plan B in case something happens to your device.</li><li><strong>Authy. </strong>Authy is our favorite two-factor authentication app because it has online backups linked to your phone number. You can restore everything in one click and install additional 2FA apps if your original device is lost or stolen.</li></ul><p>To enable 2FA in your Gainium account, head over to Settings → Security. Find the 2FA switch, and once you turn it on, you will be shown a QR code that can be scanned with your 2FA app.</p><p>Once you successfully link 2FA to your authenticator app, you will be shown a set of recovery tokens if you lose your 2FA device. Write down these codes and keep them in a safe place.</p><h2>Recovering/resetting 2FA</h2><p>If your 2FA device is no longer available, you can log in to your account using one of the recovery tokens provided during setup. If the codes are not available, contact us, and we will do our best to help.</p>

Learn how to secure your account with 2-Factor Authentication (2FA). In this article we also explain how to recover your account if you lost your 2FA device.

Enabling 2-factor authentication (2FA)

Account Management

Find answers to common questions about Gainium.

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<p>Your bankroll is the total sum of money you have allocated for trading.&nbsp;One crucial factor for a trader is to follow basic bankroll and <a href="https://gainium.io/academy/managing-risk">risk management</a> guidelines. Risk management aims to keep the likelihood of going bankrupt (losing all of your trading money) as low as possible.</p><p>The bankroll graph in your dashboard represents the allocation of your bankroll currencies. A bankroll currency is any quote currency your bots are trading. For example, if you have two bots, one grid bot on BTC/<strong>USDT,</strong> one DCA bot on BNB/<strong>BUSD</strong>, and one signal bot on ETH/<strong>BTC;</strong> then USDT, BUSD, and BTC are your bankroll currencies.</p><p><img src="https://back.gainium.io/uploads/bankroll_268053b8a8.webp" alt="bankroll.webp"></p><p>Having a bird's eye view of your bankroll is important to <a href="https://gainium.io/academy/manage-overextended-account">avoid overextending</a> your account. The bankroll graph will help you to do just that, let's go over each section:</p><ul><li>Used (=purchased): The dollar value of the base that all bots for this currency hold, including the value for the base of the whole bot (not just active smart orders).</li><li>Limit: Value of quote currently in limit orders to purchase base.</li><li>Planned: Value of quote maximum that the bots could use to purchase base. For a DCA bot, this is maximum remainder DCA orders; for a grid bot, this is all the planned buy orders.</li><li>Free &amp; Over. If the planned amount is less than the available balance, then you would have 'Free' quote that is not part of any bot. If the planned amount is higher than the available balance, then all the available balance could potentially be used plus more; this is the 'Over'.</li></ul><p>If you can see 'Over' section in the graph, it means that your account is overextended for that bankroll currency. Being overextended doesn't mean that there is an inminent risk, but you should always keep an eye on this value because if the market changes drastically, your bots could end up using all the available currency and run out of funds.</p>

Learn how to interpret the bankroll graph.

Bankroll

<p>The profit chart shows the aggregated profit in USD generated over time. The profit chart stats can be found on your account dashboard or any bot page.&nbsp;</p><p>The profit chart located in the dashboard shows the profit in USD for the full account. The USD value is calculated at the moment of profit. It does not change over time (if you generated the equivalent of $1 and profited in crypto, the profit value of that transaction will be $1 even after the crypto changes in value).</p><p>The profit chart located on the bot pages can display data in base, quote, or USD. You can select which currency you want to see on the graph by changing the currency switch above the chart.</p><p><sup>*</sup>Exchange fees <a href="https://gainium.io/help/are-exchange-fees-excluded-from-profit-calculation">are excluded</a> (accounted for) in profit calculation.</p><figure class="image"><img src="https://back.gainium.io/uploads/profit_chart_af732cbf8e.png" alt="profit-chart.png"><figcaption>Profit chart</figcaption></figure>

Understanding Profit Stats and Graphs in Dashboard and Bot Pages

<p>For crypto traders and investors new to the game or seeking to hone their skills, paper trading has emerged as a valuable tool for gaining experience without risking hard-earned capital. In this article, we'll delve into the nuances of paper trading, examining its benefits and drawbacks, and providing essential tips to maximize your learning experience with Gainium's paper trading feature.</p><h2>Benefits of Paper Trading in Crypto</h2><p>Before we begin, we must address an important question, why should we paper trade? There are numerous benefits:</p><ul><li><strong>Risk-Free Learning</strong>: Paper trading is a simulated trading environment where users can practice buying and selling cryptocurrencies without the risk of losing actual money. This provides an opportunity to learn the ropes, test strategies, and develop confidence before transitioning to real-world trading.</li><li><strong>Get familiar with Gainium's platform</strong>: As an aspiring crypto trader, it is crucial to understand how to navigate the platform and use its features. Paper trading allows users to become acquainted with Gainium's interface, order types, and technical analysis tools without incurring any financial risk.</li><li><strong>Learn emotional Control</strong>: Trading can be an emotional rollercoaster, and developing emotional resilience to cope with market fluctuations is essential. Paper trading provides a testing ground for managing emotions like fear, greed, and frustration, helping traders become more disciplined in their decision-making.</li></ul><h2>Drawbacks of Paper Trading in Crypto</h2><p>Though there are many benefits to paper trading, we must also remember the following:</p><ul><li><strong>Lack of Real-World Pressure</strong>: While paper trading shields users from financial loss, it also removes the sense of urgency and pressure that comes with real-money trading. Consequently, traders may not fully experience the psychological challenges associated with actual trading.</li><li><strong>Overconfidence</strong>: Success in paper trading does not guarantee success in real-world trading. Some traders may become overconfident after a string of paper trading wins, leading to rash decisions and potential losses when they transition to trading with real money.</li><li><strong>Differences with real exchange order execution</strong>: In paper trading orders are instantly executed at the triggered price. In live trading, however, orders may be executed at different prices due to slippage, or perhaps the order may not be executed at all during high volume. That's why it's important that the same strategy might yield different results in paper trading and real trading.</li></ul><h2>Using paper trading in Gainium</h2><p>To start paper trading in Gainium, switch to Paper mode. You can do so under your account menu in the top bar.</p><figure class="image"><img src="https://back.gainium.io/uploads/Switch_paper_641078664c.png" alt="Switch-paper.png"></figure><p>Once you have switched to paper mode, you can go to your exchanges and add a new paper trading exchange. Input the desired amount of USDT, and that's it! You can now trade as if it was real money on your exchange.</p><p><img src="https://back.gainium.io/uploads/add_exchange_a287032f64.png" alt="add-exchange.png"></p><p>Think of the paper trading mode as another account. You can add and remove exchanges; all other functionality remains the same.</p><h3>Managing your paper trading account in Gainium</h3><p>You can easily manage your paper trading account from the “Exchanges” menu. There you will find the option of adding new accounts, adding more funds to existing accounts, deleting accounts, and resetting all paper trading data.</p><h2>Conclusion</h2><p>Paper trading serves as an invaluable resource for new and experienced crypto traders alike. By embracing the benefits, acknowledging the drawbacks, and employing best practices, you can utilise paper trading as a springboard to a successful and profitable trading career in the ever-evolving world of cryptocurrencies.</p><p>Paper trading, a.k.a. forward testing, is when you trade without using real-time any real money. Paper trading is an essential tool for both beginner and experienced traders alike. It allows investors to practice their trading strategies, test different assets, and become familiar with the market without risking actual capital. It also provides a safe environment for those just beginning to learn about crypto or who want to test new techniques before committing real money.</p><p>&nbsp;</p>

In this article we explain the power of paper trading and how to use paper trading features in Gainium.

Paper Trading (Forward testing)

<p>This guide is for you if you are a developer looking to access Ganium through API keys. Gainium API keys allow you to access your Gainium account programmatically so you can create apps and scripts.</p><h2>Enable 2FA</h2><p>2FA must be enabled before you can create API keys. If you haven't already, <a href="https://gainium.io/help/2fa">enable 2FA</a> on your account before proceeding.</p><h2>Create API keys</h2><p>To generate a new API key:</p><ul><li>1. Click "New API access token."</li><li>2. Give the key a descriptive name so you can remember its purpose later</li><li>3. Choose the permissions this key should have in your Gainium account. With Read permission, you can view the details of your bots and deals but not make any changes. If you need to be able to create/edit bot and values, you'll need Write access.</li><li>4. Click "Create"</li><li>5. Copy and paste the newly created API Key and Secret into your favorite coding IDE or third-party app</li></ul><h2>API Documentation</h2><p>Please visit our <a href="https://api.gainium.io/api/docs/">API docs</a> for up-to-date information on the API endpoints and parameters.</p><h2>API FAQ</h2><p><strong>Can I use the API key for paper trading?</strong></p><p>Yes, all API calls for paper trading work precisely the same as for live accounts; make sure to add paperContext=true to the API call.</p><p><strong>What are the API limits?</strong></p><p>50 calls/minute.</p><p><strong>Can I retrieve information on deals on my exchange account not created in Gainium?</strong></p><p>No, currently, this is not possible. Only deals and bots created through your Gainium account can be accessed using Ganium's API.</p>

In this article we explain how to access your Gainium account programmatically through API keys.

Gainium API for developers

<p>Due to popular demand, we have published our product roadmap. You can now see what's coming ahead and vote or suggest the features you want us to work on next:</p><ul><li><a href="https://gainium.canny.io">Gainium's Product Roadmap</a></li><li><a href="https://gainium.canny.io/feature-requests">Feature requests</a></li></ul><p>You can use <a href="https://forms.clickup.com/3652031/f/3fedz-4145/FKW9LML3N6ZVGBH9UW">this form</a> if you have other feedback or would like to report a bug.</p><p>Please keep the feedback coming!</p>

Would you like to know what features are coming up? Would you like to suggest features to Gainium? In this post we explain how to do that.

Feature Requests and Product Roadmap

<p>Dear users,</p><p>You can now share your feedback or report bugs through <a href="https://forms.clickup.com/3652031/f/3fedz-4145/FKW9LML3N6ZVGBH9UW">this form</a>.&nbsp;</p><p>The form response is immediately forwarded to our technical support team, so you can rest assured that we will be working on it right away.</p>

Use this form for feedback or bug reports

Feedback / Bug reporting

<p>Welcome to Gainium's referral program guide. In this article, we'll walk you through the inner workings of our system, ensuring that you maximize your earnings and understand the benefits it brings to you and your referred friends.</p><p>To get started, visit your <a href="https://app.gainium.io/affiliate">affiliate dashboard</a>.</p><h2><strong>How the Referral System Works</strong></h2><p><strong>Link Activation &amp; Duration:</strong></p><ul><li>Once visitors click on your Gainium referral link from your website or any other publishing location, they are directed to the Gainium website.</li><li>From this point, visitors have a <strong>30-day window</strong> to complete their registration to connect your accounts.</li><li>However, there's a catch: if the visitor clicks on another referral link or returns to the Gainium website via another coded advertising link within these 30 days, your referral link gets overwritten. In simpler terms, that visitor's account won't be linked to you, and you won't earn a commission from them.</li></ul><p><strong>Referral Commission &amp; Levels:</strong></p><ul><li>The commission you earn from referring a new user to Gainium depends on the number of successful referrals you've made in the past 30 days. Here's the breakdown:<ul><li><strong>Level 1:</strong> Earn a <strong>30%</strong> commission with <strong>0-4 referrals</strong>.</li><li><strong>Level 2:</strong> Earn a <strong>35%</strong> commission with <strong>5-24 referrals</strong>.</li><li><strong>Level 3:</strong> Earn a <strong>40%</strong> commission with <strong>25-49 referrals</strong>.</li><li><strong>Level 4:</strong> Earn a <strong>45%</strong> commission with <strong>50-99 referrals</strong>.</li><li><strong>Level 5:</strong> Earn a <strong>50%</strong> commission with <strong>100 or more referrals</strong>.</li></ul></li></ul><p><img src="https://back.gainium.io/uploads/affiliate_level_62a23f0e08.jpeg" alt="affiliate-level.jpeg"></p><h2>Getting started with referral links</h2><ol><li>Generate a new link: You can generate distinct links for various campaigns or platforms as an affiliate. This helps in ensuring that each link you create aligns with the specific audience or strategy you have in mind.</li><li>Choose a unique Identifier: Each link you generate will have an additional unique identifier. This isn’t just a random string of characters; it’s a powerful tool that enables you to split stats and differentiate the performance of one campaign from another.</li><li>Deep Dive into Stats: With these identifiers, you can gain insights into which campaigns drive the most traffic and conversions. Perhaps your Twitter audience is more engaged than your blog readers, or a promotional strategy is outshining the rest. These insights allow you to allocate your efforts more efficiently.</li></ol><p><img src="https://back.gainium.io/uploads/affiliate_links_0ec33d0e41.jpeg" alt="affiliate-links.jpeg"></p><h2>Benefits for referred users</h2><p><strong>Splitting the Commission with Referred Friends</strong></p><p>Gainium offers a unique feature that allows you to split your commission with your referred friend. This means they can receive a discount when they use your referral link to make a purchase.</p><p>You can set the commission split on a per-link basis. Let's illustrate this with an example:</p><ul><li>Assume you're at Level 5, enjoying a 50% commission. You create a referral link with a 50-50% split. Your friend is considering a subscription priced at $500.</li><li>When they use your link, 50% of the purchase value, which is $250, will be split between you. Each of you will receive $125.</li><li>Your friend will see this $125 discount on their purchase, reducing their total payable amount to $375. Meanwhile, you'll receive a credit of $125 in your account when the purchase is completed.</li></ul><p><img src="https://back.gainium.io/uploads/affiliate_split_6a44e1f865.jpeg" alt="affiliate-split.jpeg"></p><p><strong>Extended Trial Period for Referred Users</strong></p><p>A special perk awaits those who join Gainium through an affiliate link! Recognizing the trust and confidence shared by our affiliates; we're offering an extended trial period for users who sign up via these referral links.</p><p>Typically, new users receive a 7-day trial period to explore Gainium’s features. However, when your friend registers using an affiliate link, their trial duration doubles to 14 days. This means they get an entire fortnight to dive deep into what Gainium offers, understand its capabilities, and see firsthand how it can revolutionize their trading strategies.</p><h2>Getting paid</h2><ul><li>Payout to your wallet: You can request a payout once your affiliate wallet balance exceeds 25 USDT. When you're ready to cash out, specify the wallet address where your funds would be transferred. Ensure it's accurate, as Gainium cannot reverse transactions made to incorrect addresses.</li><li>Transfer to Payment Wallet: Not interested in cashing out just yet? No worries! Transfer your referral earnings directly to your payment wallet. This lets you use your accrued rewards to purchase a Gainium subscription. There's no minimum amount required for this transfer. However, remember that the operation cannot be reversed once transferred to the payment wallet. So, choose wisely!</li></ul><h3 style="margin-left:0px;"><strong>Locked Affiliate Funds</strong></h3><p style="margin-left:0px;">Gainium implements a "locking" mechanism for affiliate earnings to maintain transparency and fairness in our referral system. This approach has been crafted to manage scenarios wherein a user, referred by an affiliate, requests a refund for their purchase.</p><p style="margin-left:0px;"><strong>How it works:</strong></p><ul><li style="margin-left:0px;"><strong>Monthly Payments:</strong> If a user subscribes to a monthly package, the commission credited to the affiliate will remain "locked" until the subscription period concludes. Once the month ends and no refund was issued to the referred user, the affiliate funds are fully unlocked and made available for withdrawal.</li><li style="margin-left:0px;"><strong>Yearly Payments:</strong> Given the extended duration, the commission on yearly payments is unlocked incrementally. For each month that passes without a refund request by the referred user, a proportional part of the affiliate's commission becomes available. This means that the entire commission amount will be unlocked by the end of the yearly subscription period, assuming no refund was processed.</li></ul><p style="margin-left:0px;">This locking system is designed to protect the interests of both Gainium and our dedicated affiliates. It ensures that commissions are granted genuinely for successful and sustained referrals, thereby preserving the integrity and trustworthiness of our affiliate program.</p><p><img src="https://back.gainium.io/uploads/affiliate_wallet_98132bd8f2.jpeg" alt="affiliate-wallet.jpeg"></p><h2><strong>In Conclusion</strong></h2><p>Gainium's referral program rewards you for bringing in new members and ensures those who join via your link benefit. The system is designed to provide value for both parties, reinforcing a bond of trust and mutual benefit.</p><p>For any further queries or issues related to the referral system, don't hesitate to reach out to our support team.</p>

Unlock the secrets of Gainium's Referral System. Learn how link durations work, understand commission levels based on successful referrals, and discover how to split commissions with friends for mutual benefits.

Understanding Gainium's Referral System

Platform

Learn how to use the features of the trading terminal.

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<p>Gainium's cutting-edge trading platform provides its users a unique and customizable experience. With an array of versatile tools and features, Gainium ensures traders have access to the best resources to maximize their gains. This article will delve into the platform's three core trading terminal types: Simple, Smart, and Import. Understanding these options will help you make informed decisions when executing trades, whether you're a novice or a seasoned trader. Let's get started!</p><h2>Simple</h2><p>The Simple trading terminal is designed for traders who prefer a straightforward, hassle-free experience. This option allows users to execute buy or sell orders without creating an open order (i.e., tracking the profit or loss on that order). It's perfect for those who want to make quick decisions and act on market movements with minimal configuration. Key features of the Simple trading terminal include:</p><ul><li>Instant buy or sell orders</li><li>No open-order creation</li><li>Ideal for fast-paced trading</li></ul><p>Examples of scenarios where you may want to choose simple trade:</p><ul><li>Swapping tokens, for example, between stablecoins</li><li>Taking profit from long-term holdings</li><li>In general, any transaction that you don't need to keep track of</li></ul><h2>Smart</h2><p>The Smart trade terminal type is an excellent choice for traders seeking more advanced features and customization. This terminal type allows users to create open orders with optional take profit, stop loss, and Dollar Cost Averaging (DCA) settings. This flexibility enables traders to optimize their strategies and manage risk more effectively. The Smart trading terminal boasts the following features:</p><ul><li>Open order creation, tracking profit and a host of other performance metrics</li><li>Customizable take profit, stop loss, and DCA settings</li><li>Enhanced control over trading strategies</li><li>Suitable for intermediate to advanced traders</li></ul><p>Examples of scenarios where you may want to choose smart trade:</p><ul><li>Trades that you plan to close (meaning, sell back the token if going long or buy back the token if going short)</li><li>Preserving the value of your portfolio by going short on your assets before a downturn and repurchasing them at a lower price</li><li>Buying tokens for long-term holding, if you want to keep track of the average buy price</li></ul><h2>Import</h2><p>Lastly, the Import trading terminal type caters to users who have executed trades outside of Gainium but want to manage their positions within the platform. This option allows traders to import their existing trades, while also providing the flexibility to set optional take profit, stop loss, and DCA settings. The Import trading terminal is perfect for traders who want to consolidate and streamline their trading experience. Key benefits of the Import trading terminal include:</p><ul><li>Create an open order by importing trades executed outside Gainium</li><li>Customizable take profit, stop loss, and DCA settings</li><li>Unifying trade management within the Gainium platform</li><li>Suitable for traders migrating from other platforms</li></ul><p>Examples of scenarios where you may want to choose import trade:</p><ul><li>Trades that you plan to close, but were opened directly on the exchange or another trading platform</li><li>Creating partial take profit trades from your long-term holdings</li></ul><p>&nbsp;</p><p>Gainium's three trading terminal types cater to a wide range of trading styles and preferences. By understanding the features and benefits of the Simple, Smart, and Import types, you can make informed decisions and optimize your trading experience. Whether seeking a streamlined and straightforward approach or requiring advanced customization and control, Gainium's trading terminals have got you covered.</p>

This article explains the different deal types you can execute in Gainium's trading terminal.

Trading Terminal Deal Types

Trading Terminal

In this category, you can learn about the technical indicators you can use in Gainium and how to configure them for best results

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<p>In the world of cryptocurrency trading, the pursuit of innovative strategies is a never-ending journey. One such approach that has gained popularity in recent years is the QuickFingers Luc (QFL) method. This trading technique emphasizes precision, patience, and a deep understanding of market structure. In this article, we'll delve into the key aspects of the QFL method and explore how you can harness its power to excel in crypto trading.</p><h2>What is QFL?</h2><p>The QFL trading method is based on the premise that market inefficiencies create profitable opportunities for patient and disciplined traders. Developed by a trader known as Luc, this strategy focuses on identifying support and resistance levels, waiting for significant drops in price, and then capitalizing on the subsequent rebounds.</p><p>In other words, QFL looks for panic sales and tries to anticipate a dead cat bounce.</p><p>For a detailed explanation of the QFL methodology, you can check out this <a href="https://docs.google.com/document/d/13iqxT63UqdkbTMmt6VRMlWPL7hb5bp5sk6IqkQhBm8M/edit">document</a> compiled from<a href="https://steemit.com/@quickfingersluc"> Quickfingers Luc's Steemit blog</a>.</p><p>Support and resistance levels are the foundation of the QFL method. A support level is a price point where buying pressure is strong enough to prevent further declines, while resistance is a price level where selling pressure is strong enough to prevent further gains. By accurately identifying these levels, traders can predict potential price movements and plan their trades accordingly.</p><p>A critical aspect of the QFL method is pinpointing "base levels," which are strong support or resistance levels that have been held multiple times in the past. Base levels often serve as a springboard for price rebounds, making them prime targets for entry points. To identify a base level, look for price areas where the asset has reversed multiple times, indicating strong buying or selling pressure.</p><p>The QFL method relies on the principle of "buying the dip." After identifying a base level, traders wait for the price to drop significantly below that level before entering a long position. This approach ensures that traders buy low and maximize their profit potential when the price rebounds.</p><h2>Practical considerations when using the QFL strategy</h2><h3>Patience is a virtue</h3><p>One of the key tenets of the QFL method is patience. Traders must resist the urge to enter positions prematurely and instead wait for the optimal entry point, which can sometimes take days or even weeks. By maintaining discipline and adhering to the strategy, traders can significantly improve their chances of success.</p><h3>Risk Management and Stop-Loss Orders</h3><p>Risk management is essential when using the QFL method, as with any trading strategy. To minimize potential losses, traders should set stop-loss orders below the base level. This ensures that if the price does not rebound as anticipated, the trader can exit the position with minimal damage to their portfolio.</p><h3>Exiting the Trade</h3><p>Knowing when to exit a trade is as important as knowing when to enter. With the QFL method, traders typically target a predetermined profit level or wait for the price to reach the next resistance level.</p><h2>How to use QFL in Gainium</h2><p>Gainium's implementation of QFL is based on this <a href="https://www.tradingview.com/script/PIFGdVsZ-QFL-base-scanner/">TradingView script by rex_wolfe</a>.</p><p>Buys are marked when the price has bounced x% above the base and then fallen y% below the base.</p><figure class="image"><img src="https://back.gainium.io/uploads/gainium_qfl_settings_9075aa1de1.png" alt="gainium-qfl-settings.png"><figcaption>Gainium QFL settings</figcaption></figure><h2>Conclusion</h2><p>The QuickFingers Luc (QFL) trading method offers a unique and disciplined approach to cryptocurrency trading, focusing on precision, patience, and a deep understanding of market structure. By mastering the identification of base levels and capitalizing on significant price drops, traders can exploit market inefficiencies and maximize their profit potential. With patience, discipline, and a strong focus on risk management, the QFL method can be an invaluable tool in the arsenal of any cryptocurrency trader.</p><h2>&nbsp;</h2>

Learn about the Quickfingers Luc (QFL) strategy and how to use it in Gainium.

Quickfingers Luc (QFL)

<p>The cryptocurrency market has seen a surge of interest in trading automation, as traders seek to minimize human error and capitalize on market opportunities more efficiently. One powerful technical indicator that can enhance trading bot performance is the Average Directional Index (ADX). In this article, we'll delve into the effective use of ADX in your automated trading strategy, focusing on the BTC/USDT pair.</p><h2>Understanding the ADX Technical Indicator</h2><p>The ADX, developed by J. Welles Wilder Jr. in 1978, is a momentum-based technical indicator that measures the strength of a trend without considering its direction. The ADX ranges from 0 to 100, with higher values indicating a stronger trend. Typically, a value above 25 suggests a strong trend, while a value below 20 indicates a weak or non-trending market. The ADX is derived from two other Wilder's indicators, the Positive Directional Indicator (+DI) and the Negative Directional Indicator (-DI), which provide insight into the direction of the trend.<br>&nbsp;</p><figure class="table"><table><tbody><tr><td><strong>ADX Value</strong></td><td><strong>&nbsp;Trend Strength</strong></td></tr><tr><td>0-25</td><td>&nbsp;Non-trending market or range-bound market</td></tr><tr><td>25-50</td><td>Strong trend</td></tr><tr><td>50-75</td><td>Very strong trend</td></tr><tr><td>75-100</td><td>&nbsp;Extremely strong trend (rarely happens and can be considered unsustainable)</td></tr></tbody></table></figure><h2>Using the ADX indicator in Gainium</h2><p>You can select this indicator by selecting “Technical Indicators” from the drop-down menu first then “ADX” in the “Indicator” Section.</p><figure class="image image_resized" style="width:50.82%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_01_at_17_38_49_08a719285a.png" alt="Screenshot 2023-04-01 at 17.38.49.png"><figcaption>Deal Start&nbsp;</figcaption></figure><p>The Adx indicator in Gainium allows you to trade a trending market by selecting the value and the condition. When price action is supported by a crossover of a desired value of ADX, the more likely the move is going to continue in that direction. Meaning that ADX is a very good tool to support a real breakout.</p><figure class="image image_resized" style="width:51.11%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_03_at_17_09_18_7db210263e.png" alt="Screenshot 2023-04-03 at 17.09.18.png"><figcaption>ADX Indicator in Gainium</figcaption></figure><p>The most common ADX settings are a 14-period length, a high volatility threshold of 25, and a low volatility threshold of 20. In other words, a market is considered volatile when the ADX is greater than 25, and calm when it is less than 20.</p><h2>Using ADX indicator in bot trading</h2><p>Here are a few examples of how you can incorporate ADX in your bot strategy.</p><h3>A. ADX Trend Following Strategy</h3><p>In a trend-following strategy, your trading bot will enter a long position when the ADX value is above 25. This is an excellent time to enter a trade in the direction of the trend. For example, if the ADX is rising and above 30 while the asset is increasing in price, it could signal a good time to enter a long position (buy).</p><p>In the image below, you can see the price action in the chart BTC USDT when ADH is higher than 30, and the price keeps rising in the same direction.</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_11_at_16_06_46_ba015bdaca.png" alt="Screenshot 2023-04-11 at 16.06.46.png"><figcaption>ADX Crossing up 30</figcaption></figure><h3>B. ADX Range Trading Strategy</h3><p>In a range trading strategy, your bot will capitalize on the lack of a strong trend by buying low and selling high within a specified price range. Your bot can implement range trading tactics if the ADX value falls below 20, indicating a weak or non-trending market. Combining the ADX with other range-bound indicators, such as <a href="https://gainium.io/help/bb">Bollinger Bands</a> or <a href="https://gainium.io/help/stoch">Stochastic Oscillator</a>, or <a href="https://gainium.io/help/stochrsi">stoch RSI,</a> can further improve the accuracy of buy and sell signals.</p><p>For instance, when the ADX for the BTC/USDT pair drops below 20 and the price reaches the lower Bollinger Band, the bot can initiate a long position, anticipating an upward price movement. Conversely, the bot can exit the position or create a short trade when the price reaches the upper Bollinger Band.</p><h3>C. ADX Divergence Trading Strategy</h3><p>If the ADX is trending downward while the asset's price is trending upward, this is a divergence and could signal that the trend is weakening. It may be an excellent time to consider exiting the trade or taking profits. In the image below, the price is rising while ADX is decreasing.<br>&nbsp;</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_11_at_16_10_19_230d8a73b1.png" alt="Screenshot 2023-04-11 at 16.10.19.png"><figcaption>Divergence</figcaption></figure><h3>D. ADX Breakout Strategy</h3><p>The breakout strategy aims to capitalize on significant price movements that follow periods of consolidation. When the ADX value rises from below 20 to above 25, it can signal a potential breakout.&nbsp;</p><h2>Practical considerations when trading with ADX</h2><p>As mentioned before, ADX's weakness is that it cannot determine the direction of a trend, so it is not always beneficial by itself. It is often combined with other indicators, for example, with RSI. A buy signal could be placed when RSI rises and ADX rises and crosses up 30. In the example below, both RSI and the Volume indicators support the long entry as the price increases. You then can decide to take profit when RSI and /or volume start to decline.<br>&nbsp;</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_11_at_16_15_22_e80a4d60a6.png" alt="Screenshot 2023-04-11 at 16.15.22.png"><figcaption>ADX with RSI and Volume</figcaption></figure><h2>Conclusion</h2><p>The ADX indicator can be valuable for assessing trend strength and informing your crypto trading bot's decision-making process. As with any trading strategy, testing and refining the parameters to suit your risk tolerance and the prevailing market conditions is crucial. Incorporating the ADX with additional <a href="https://gainium.io/help/category/technical-indicators">technical indicators</a> and fundamental analysis can help create a more robust and well-rounded trading bot strategy.</p>

In this article, we explain what is the ADX indicator and how it can be used in bot trading.

Average Directional Index (ADX)

<p>As the popularity of cryptocurrency trading continues to grow, so does the interest in trading automation. Trading bots can streamline the investment process by minimizing human error and capitalizing on market opportunities more effectively. One versatile technical indicator that can greatly enhance your trading bot's performance is the Bollinger Band Width (BBW). In this article, we'll explore how to effectively use the BBW indicator in your automated trading strategy.</p><h2>Understanding the BBW Indicator</h2><p>The BBW, developed by John Bollinger in the 1980s, is a technical indicator that measures the distance between the upper and lower <a href="https://gainium.io/help/bb">Bollinger Bands</a>. The Bollinger Bands are composed of three lines: a Simple Moving Average (SMA) and two lines plotted at a specified number of standard deviations above and below the SMA. The BBW indicator helps traders identify periods of high volatility and potential price reversals by measuring the relative width of the bands.</p><p>BBW = (Upper Bollinger Band - Lower Bollinger Band)&nbsp;/ Middle Bollinger Band</p><p>During periods of high volatility, the distance between the Lower and Upper Bollinger Bands is wider, eventually indicating the end of a move. During periods of low volatility, the distance between the bands will reduce; hence the value of BBV is closer to zero. Extended periods of very low volatility are followed by a sudden surge known as the Squeeze.</p><p>This indicator is non-directional, which means it only registers the strength of the trend rather than its direction. As a result, it should be used in conjunction with other indicators.</p><h2>Using BBW in Gainium</h2><p>You can select this indicator by selecting “Technical Indicators” from the drop-down menu first, then “BBW” in the “Indicator” Section.</p><figure class="image image_resized" style="width:50.5%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_03_at_18_05_15_3b2a466729.png" alt="Screenshot 2023-04-03 at 18.05.15.png"><figcaption>BBW indicator</figcaption></figure><h2>How to incorporate BBW in your bot trading</h2><h3>A. BBW Volatility Breakout Strategy</h3><p>In a volatility breakout strategy, your trading bot will capitalize on significant price movements following periods of low volatility. When the BBW value is low, it indicates a potential breakout as the bands are narrow. Your bot can initiate a long position when the price breaks above the upper Bollinger Band or a short position when it breaks below the lower Bollinger Band.</p><p>For example, in the image below, when BBW is very low (I have drawn a line to visualize when BBW is below 0.0183) and RSI is oversold (below 30), it could indicate a potential strong downtrend move of the price. Conversely, when the BBW is low and the RSI is above 70 the price is likely to drop.&nbsp;</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_03_at_18_03_52_85abb6d0c8.png" alt="Screenshot 2023-04-03 at 18.03.52.png"><figcaption>BBW and RSI</figcaption></figure><h3>B. BBW Mean Reversion Strategy</h3><p>In a mean reversion strategy, your trading bot will take advantage of price fluctuations by buying low and selling high within the Bollinger Bands. When the BBW value is high, indicating a volatile market, your bot can initiate a long position when the price touches the lower Bollinger Band and a short position when it touches the upper Bollinger Band.</p><p>For instance, when the BTC/USDT pair has a high BBW value and the price reaches the lower Bollinger Band, the bot can initiate a long position, expecting the price to revert to the mean (SMA). Conversely, when the price reaches the upper Bollinger Band, the bot can exit the position or initiate a short trade.</p><h3>C. BBW Squeeze Strategy</h3><p>The squeeze strategy aims to identify potential price breakouts following periods of consolidation. When the BBW value decreases and the bands contract, it can signal a potential breakout in either direction. Your trading bot can monitor for additional technical indicators, such as a spike in trading volume or a break of a trendline, to confirm the breakout direction before initiating a trade.</p><p>Using the BTC/USDT pair as an example, if the BBW value decreases and the bands contract, your bot can monitor for additional confirmation signals, such as a significant increase in trading volume. If the price breaks above the upper Bollinger Band and trading volume surges, the bot can initiate a long position, anticipating a bullish breakout. The bot will then hold the position until the price reverses or reaches a predetermined profit target.</p><h2>Conclusion</h2><p>The Bollinger Band Width indicator can provide valuable insights into market volatility and potential trading opportunities for your crypto trading bot. You can optimize your automated trading system and enhance your investment returns by understanding and implementing the BBW volatility breakout, mean reversion, and squeeze strategies. As with any trading strategy, testing and fine-tuning the parameters to suit your risk tolerance and market conditions is essential. Combining the BBW with other <a href="https://gainium.io/help/category/technical-indicators">technical indicators</a> and fundamental analysis can further improve the effectiveness of your trading bot and contribute to a well-rounded trading strategy.</p><p><br>&nbsp;</p>

In this article, we explain what is BBW indicator and how it can be used in bot trading.

Bollinger Band Width (BBW)

<p>The rise of cryptocurrency trading has led to a surge in the adoption of trading automation. Trading bots have become an invaluable tool for investors to minimize human error and capitalize on market opportunities more efficiently. One popular technical indicator that can significantly enhance your trading bot's performance is the Bollinger Bands (BB). In this article, we'll discuss how to effectively use the Bollinger Bands indicator in your automated trading strategy.</p><h2>Understanding the Bollinger Bands Indicator</h2><p>The Bollinger Bands, developed by John Bollinger in the 1980s, is a volatility-based technical indicator that consists of three lines: a Simple Moving Average (SMA), an upper band, and a lower band. The upper and lower bands are plotted at a specified number of standard deviations (typically 2) above and below the SMA. Bollinger Bands help traders identify potential price reversals and gauge market volatility by measuring the relative width of the bands (see also the <a href="https://gainium.io/help/bbw">Bollinger Bands Width</a>).</p><p>Bollinger Bands is one of the most popular indicators used for bot trading (together with <a href="https://gainium.io/help/rsi">RSI</a>) because of its straightforward setup.&nbsp;</p><p>The bands expand when the price is volatile and contract when the price lacks volatility. When the price touches the upper Bollinger Band, it can indicate an overbought or sell signal, and if the price touches the lower band, it can mean an oversold or buy signal.</p><p>As mentioned in the BBW indicator, when the Upper and Lower bands are very close, the volatility decreases there is a higher chance of a substantial increase in price volatility. Traders call this trading opportunity the “Squeeze.”</p><h2>Using the Bollinger Bands Indicator in Gainium</h2><p>You can select this indicator by selecting “Technical Indicators” from the drop-down menu first, then “Bollinger Bands” in the “Indicator” Section.</p><figure class="image image_resized" style="width:49.75%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_03_at_18_22_47_fdabbde9ea.png" alt="Screenshot 2023-04-03 at 18.22.47.png"><figcaption>Bollinger Bands</figcaption></figure><h1>Examples of BBW Strategies for bot trading</h1><p>A. Bollinger Bands Breakout Strategy</p><p>In a breakout strategy, your trading bot will capitalize on significant price movements following periods of consolidation. When the price breaks above the upper Bollinger Band, it can signal a bullish breakout, prompting your bot to initiate a long position. Conversely, when the price breaks below the lower Bollinger Band, it can signal a bearish breakout, leading the bot to enter a short position.</p><p>For example, if the BTC/USDT pair's price breaks under the lower Bollinger Band, your bot will initiate a short position, anticipating a bearish trend. The bot will then hold the position until the price reverses or reaches a predetermined profit target.</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_03_at_18_55_47_c29714995f.png" alt="Screenshot 2023-04-03 at 18.55.47.png"><figcaption>Bollinger Bands buy and sell signals</figcaption></figure><p>B. Bollinger Bands Mean Reversion Strategy</p><p>In a mean reversion strategy, your trading bot will take advantage of price fluctuations by buying low and selling high within the Bollinger Bands. When the price touches the lower Bollinger Band, your bot can initiate a long position, expecting the price to revert to the mean (SMA). Conversely, when the price touches the upper Bollinger Band, the bot can exit the position or initiate a short trade.</p><p>For instance, when the BTC/USDT pair's price reaches the lower Bollinger Band, the bot can initiate a long position, anticipating an upward price movement toward the SMA. When the price reaches the upper Bollinger Band, the bot can exit the position or enter a short trade.<br>&nbsp;</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_07_at_17_09_28_d21fd06410.png" alt="Screenshot 2023-04-07 at 17.09.28.png"><figcaption>Trend reversal</figcaption></figure><p>C. Bollinger Bands Squeeze Strategy</p><p>The squeeze strategy aims to identify potential price breakouts following periods of consolidation. When the Bollinger Bands contract and the bands' width narrows, it can signal a potential breakout in either direction. Your trading bot can monitor additional technical indicators, such as a spike in trading volume or a break of a trendline, to confirm the breakout direction before initiating a trade.</p><p>Using the BTC/USDT pair as an example, if the Bollinger Bands contract and the width narrows, your bot can monitor additional confirmation signals, such as a significant increase in trading volume. If the price breaks above the upper Bollinger Band and trading volume surges, the bot can initiate a long position, anticipating a bullish breakout. The bot will then hold the position until the price reverses or reaches a predetermined profit target.<br>&nbsp;</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_07_at_17_12_18_74ef6d3bca.png" alt="Screenshot 2023-04-07 at 17.12.18.png"><figcaption>The Squeeze</figcaption></figure><h2>Practical considerations when using Bollinger Bands in Bot Trading</h2><p>Traders can also use Bollinger Bands across multiple timeframes to confirm trends and generate trading signals. For example, if the price is above the lower Bollinger Band on the daily chart and the 1-hour chart there is a squeeze, which indicates a strong uptrend, it may be an excellent time to enter a long position. In the example below, the price finds support on the daily timeframe, indicating that the squeeze occurring in a 1-hour timeframe might lead to an upward move.<br>&nbsp;</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_07_at_17_18_49_23bf886de7.png" alt="Screenshot 2023-04-07 at 17.18.49.png"><figcaption>Price support on daily on the lower band</figcaption></figure><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_07_at_17_19_34_1ceabad37b.png" alt="Screenshot 2023-04-07 at 17.19.34.png"><figcaption>Squeeze in 1 hour</figcaption></figure><h2>Conclusion</h2><p>The Bollinger Bands indicator can provide valuable insights into market volatility and potential trading opportunities for your crypto trading bot. As with any trading strategy, testing and fine-tuning the parameters to suit your risk tolerance and market conditions is essential. Combining the Bollinger Bands with other <a href="https://gainium.io/help/category/technical-indicators">technical indicators</a> and fundamental analysis can further improve the effectiveness of your trading bot and contribute to a well-rounded investment approach.</p>

In this article, we explain what is the Bollinger Bands indicator and how it can be used in bot trading.

Bollinger Bands (BB)

<p>The digital currency market is an ever-evolving landscape, rife with opportunities for savvy investors to capitalize on the use of trading bots. By leveraging the power of algorithms, these bots can execute trades with precision and speed unmatched by human traders. One essential element in the development of an effective trading bot is the incorporation of moving averages. This article explores the various types of moving averages and how they can be utilized to optimize your crypto trading bot.</p><h2>Type of Moving Averages used in crypto trading</h2><h3>Simple Moving Average (SMA)</h3><p>The Simple Moving Average (SMA) is calculated by averaging the closing prices of a specific number of periods. This basic method smooths out price fluctuations, revealing underlying trends. Although it's straightforward and easy to understand, the SMA tends to lag behind the actual price movement, making it less responsive to sudden changes. Traders use this indicator to find buy and sell signals for assets and identify support and resistance zones.</p><h3>Exponential Moving Average (EMA)</h3><p>The Exponential Moving Average (EMA) is a more advanced and responsive variation of the SMA. By applying more weight to recent prices, the EMA reacts more quicker to market fluctuations. This makes it a popular choice among traders who prefer a more dynamic approach to their automatic trading strategies. EMA is a more popular choice for crypto assets than SMA because the volatility of these assets requires a more responsive MA.</p><h3>Weighted Moving Average (WMA)</h3><p>The Weighted Moving Average (WMA) assigns varying degrees of importance to different periods, with the most recent prices receiving the highest weight. This results in a moving average that is more sensitive to recent market changes, providing a clearer picture of current trends for your trading bot to act upon.</p><h3>Double Exponential Moving Average (DEMA)</h3><p>The Double Exponential Moving Average (DEMA) is a refinement of the EMA, designed to further reduce lag time. By calculating two EMAs and combining them, the DEMA generates a moving average that is faster and more responsive than the standard EMA, making it an excellent choice for volatile markets like cryptocurrency.</p><h3>Triple Exponential Moving Average (TEMA)</h3><p>The Triple Exponential Moving Average (TEMA) takes the concept of the DEMA one step further, combining three EMAs to achieve even greater responsiveness. TEMA excels at detecting trends in fast-moving markets, providing an edge for trading bots seeking to capitalize on swift price movements.</p><h3>Hull Moving Average (HMA)</h3><p>Developed by Alan Hull, the Hull Moving Average (HMA) is designed to reduce lag and improve the smoothness of the average. By combining a weighted moving average with the square root of the chosen period, the HMA achieves a more responsive and accurate representation of market trends, making it ideal for crypto trading bots.</p><h3>Rolling Moving Average (RMA)</h3><p>The Rolling Moving Average (RMA) is a type of moving average that places more weight on recent data points and less on older data points. It is calculated by subtracting the weighted moving average of past data points from the current data points' average.&nbsp;<br><br>The formula for RMA is: RMA = SMA(2 x n, X) - SMA(n, X), where SMA is the Simple Moving Average, n is the number of periods, and X is the data series.&nbsp;</p><p>EMA and RMA use a multiplier in their formula; however, EMA is faster as the multiplier is higher.</p><h3>Volume-Weighted Moving Average (VWMA)</h3><p>The Volume-Weighted Moving Average (VWMA) considers both price and trading volume, offering a more comprehensive view of market activity. By accounting for the impact of trading volume on price movement, the VWMA provides a unique perspective that can enhance the performance of your crypto trading bot.</p><h2>Choosing a Moving Average for Your Trading Strategy</h2><p>Selecting the right moving average for your trading strategy is crucial for optimizing the performance of your crypto trading bot. Here are some key factors to consider when making your decision:</p><ul><li><strong>Market Volatility</strong>: Evaluate the volatility of the cryptocurrency market you're targeting. If it's highly volatile, you might opt for a more responsive moving average like the EMA, DEMA, or TEMA. On the other hand, a less volatile market may benefit from the use of the SMA or WMA.</li><li><strong>Trading Frequency</strong>: Determine the frequency of your trading strategy. High-frequency traders may prefer the DEMA or TEMA, while lower-frequency traders can consider other types of moving averages that prioritize smoothness and trend identification.</li><li><strong>Trading Style</strong>: Consider your overall trading style and objectives. Are you focused on short-term gains or long-term investments? A shorter-term strategy may benefit from the responsiveness of the EMA, HMA, or VWMA, while a longer-term approach might be better served by the SMA, or WMA.</li><li><strong>Volume Analysis</strong>: Assess whether incorporating trading volume into your strategy would provide valuable insights. If so, the VWMA could offer a unique perspective that complements your existing approach.</li><li><strong>Experimentation</strong>: Don't be afraid to experiment with various moving averages to find the best fit for your trading strategy. <a href="https://gainium.io/help/backtesting-trading-bots">Backtesting</a> your bot with different moving averages can help identify which one is most effective for your specific objectives and market conditions.</li><li><strong>Combination</strong>: You can also consider using a combination of moving averages to create a more robust trading strategy. For example, you might use a longer-term SMA to identify the general trend direction while employing a shorter-term EMA to generate entry and exit signals.</li></ul><h2>Using Moving Average in Gainium</h2><p>You can select this indicator by selecting “Technical Indicators” from the drop-down menu first, then “MA” in the “Indicator” Section.</p><figure class="image image_resized" style="width:50.71%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_05_at_16_02_52_5492a98299.png" alt="Screenshot 2023-04-05 at 16.02.52.png"><figcaption>Moving Averages</figcaption></figure><p>&nbsp;</p><figure class="image image_resized" style="width:49.73%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_05_at_16_16_56_c22250fe6b.png" alt="Screenshot 2023-04-05 at 16.16.56.png"><figcaption>MA type</figcaption></figure><h2>Using Moving Averages in Bot Trading</h2><p>Examples of how to use Moving Averages in your bot trading strategy.</p><ul><li><strong>Identify the direction of the trend</strong>: One of the simplest ways to use moving averages is to identify the direction of the trend. Traders often use two moving averages, a shorter one and a longer one. If the shorter moving average is above the longer moving average, it indicates an uptrend, and if the shorter moving average is below the longer moving average, it indicates a downtrend. The 50 and the 200 MA are very popular to determine a trend. You can see in the image below that when the 50 is crossing up and staying above the 200, there is an uptrend.</li></ul><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_07_at_16_31_29_78d9c6a4d9.png" alt="Screenshot 2023-04-07 at 16.31.29.png"><figcaption>50 SMA and 200 MA</figcaption></figure><p style="margin-left:0px;">&nbsp;</p><ul><li><strong>Determine support and resistance levels</strong>: Moving averages can also be used to determine support and resistance levels. When the price of an asset is approaching a moving average, it often acts as a support or resistance level. Traders can use this information to make trading decisions, such as entering a long position when the price bounces off a moving average, acting as support. The 200 MA is often used to identify these levels. As you can see in the example below, it created a strong resistance, and the price was rejected very strongly.<br>&nbsp;</li></ul><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_07_at_16_34_54_ec97978c60.png" alt="Screenshot 2023-04-07 at 16.34.54.png"><figcaption>200 SMA support/resistance</figcaption></figure><ul><li><strong>Generate trading signals</strong>: Moving averages can also be used to generate trading signals. For example, a trader may use a crossover strategy, where they enter a long position when the shorter moving average crosses above the longer moving average, and exit the position when the shorter moving average crosses below the longer moving average. In the example below a trader can enter a long when the 50 EMA crosses up the 200 EMA. EMA is faster than SMA so they are better suited to individuate entries and exits. The trader might want to close some of the whole position the moment the 50 EMA rouches again the 200. As volume is slowly decreasing, there is a higher chance the price might not be supported by the 200 EMA any longer.<br>&nbsp;</li></ul><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_07_at_16_43_38_cc050b4de2.png" alt="Screenshot 2023-04-07 at 16.43.38.png"><figcaption>Entering and exiting a position</figcaption></figure><ul><li><strong>Use multiple timeframes</strong>: Traders can also use multiple timeframes to confirm trends and generate trading signals. For example, if the shorter moving average is above the longer moving average on both the 15-minute and hourly charts, it indicates a strong uptrend and may be an excellent time to enter a long position. In the image below, the trader might decide to enter a long on the 16 of March once the 50 EMA bounces off the 200 EMA because in the 1-hour timeframe (image above) the 50 EMA is indicating there is still a strong uptrend.</li></ul><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_07_at_16_54_26_b3ce0a7aee.png" alt="Screenshot 2023-04-07 at 16.54.26.png"><figcaption>Multiple time frames</figcaption></figure><h2>Conclusion</h2><p>Incorporating moving averages into your crypto trading bot's strategy can greatly improve its efficiency and effectiveness. By understanding the nuances of each type of moving average, you can tailor your bot's approach to best suit the dynamic and unpredictable world of digital currency trading. Harness the power of these advanced techniques to stay ahead of the competition and maximize your returns in the ever-evolving crypto market.</p>

In this article, we explain what is the Moving Averages (SMA, EMA, HMA, etc.) indicators and how they can be used in bot trading.

Moving Averages (MA)

<p>As the cryptocurrency market continues flourishing, so does the interest in trading automation. Trading bots have revolutionized how investors approach digital currencies by minimizing the human factor and reducing the effects of market volatility. One essential tool that can optimize trading bot performance is the Moving Average Convergence Divergence (MACD) indicator. This article will explore how to utilize MACD effectively in your automated trading strategy.</p><h2>What is the MACD indicator?</h2><p>The MACD is a momentum-based technical indicator that tracks the relationship between two moving averages of a digital asset's price. Developed by Gerald Appel in the 1970s, this indicator aims to reveal changes in a trend's strength, direction, and duration. The MACD consists of two components:</p><p><strong>a. MACD Line</strong>: The difference between a short-term (typically 12-day) and a long-term (usually 26-day) Exponential Moving Average (EMA).<br><strong>b. Signal Line</strong>: A 9-day EMA of the MACD Line.</p><p>The MACD Line and Signal Line interaction generates trading signals that can help identify potential entry and exit points.</p><h2>Using the MACD in Gainium</h2><p>The MACD indicator is available in your bot settings' “Deal Start” section. Select “Technical Indicators” from the “Deal start condition” drop-down menu first, then “MACD” in the “Indicator” Section.</p><figure class="image image_resized" style="width:51.13%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_11_at_16_42_02_bdcff2e4b6.png" alt="Screenshot 2023-04-11 at 16.42.02.png"><figcaption>MACD</figcaption></figure><p>In Gainium, you can see the histogram (red and green wave) by default in the chart as soon as you select the indicator. However, to be able to see the EMA line crossing that sometimes helps better visualize your entry, you need to tick “MACD” and “Signal” in the “Style” tab in the indicator settings.</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_11_at_16_49_39_84463f5691.png" alt="Screenshot 2023-04-11 at 16.49.39.png"><figcaption>Style Settings&nbsp;</figcaption></figure><h2>Implementing MACD in Your Trading Bot Strategy</h2><p>Here are a few examples of how to use the MACD indicator in your trading bots.</p><h3>A. Trend reversal (MACD Crossover) Strategy</h3><p>In the crossover strategy, your trading bot will initiate a long position when the MACD Line crosses above the Signal Line, indicating a bullish trend. Conversely, the bot will exit the position or enter a short trade when the MACD Line crosses below the Signal Line, signaling a bearish trend.</p><p>For example, your bot will initiate a long position if the BTC/USDT pair demonstrates a bullish crossover with the MACD Line rising above the Signal Line. The bot will then hold onto the position until a bearish crossover occurs, prompting an exit or a short trade.</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_11_at_17_03_41_00a59824d2.png" alt="Screenshot 2023-04-11 at 17.03.41.png"><figcaption>MACD crossover strategy</figcaption></figure><h3>B. Trend continuation Strategy</h3><p>The MACD histogram displays the difference between the MACD Line and the Signal Line, visually representing their interaction. A trading bot can use the histogram to identify potential trend reversals by monitoring changes in the histogram's slope and height.</p><p>For instance, if the BTC/USDT MACD histogram shifts from negative to positive territory, it suggests a potential bullish trend, prompting your bot to initiate a long position. On the other hand, if the histogram moves from</p><p>&nbsp;positive to negative territory, it signals a possible bearish trend, leading the bot to exit the position or enter a short trade.</p><p>In this strategy, it is helpful to bring up the EMA lines, as you can see from the image below. The fast 12 EMA is bouncing on the slower 26 EMA, confirming the continuation of the trend.<br>&nbsp;</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_11_at_17_08_36_0d5b1a4314.png" alt="Screenshot 2023-04-11 at 17.08.36.png"><figcaption>MACD trend continuation strategy</figcaption></figure><h3>C. MACD Divergence Strategy</h3><p>Divergence occurs when the price movement of a digital asset and the MACD indicator deviate from one another. Positive divergence happens when the price hits a lower low, but the MACD forms a higher low, suggesting a potential bullish reversal. Negative divergence transpires when the price reaches a higher high, while the MACD forms a lower high, indicating a possible bearish reversal.</p><p>Using the BTC/USDT pair as an example, if the price reaches a new low while the MACD forms a higher low, your bot can initiate a long position, anticipating a bullish trend. Conversely, if the price creates a new high and the MACD forms a lower high, the bot can exit the position or enter a short trade.</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_11_at_17_15_51_7eeea484dc.png" alt="Screenshot 2023-04-11 at 17.15.51.png"><figcaption>MACD divergence</figcaption></figure><h2>Conclusion</h2><p>The MACD indicator can provide valuable insights into your crypto trading bot's market trends and potential trading opportunities. As with any trading strategy, testing and fine-tuning the parameters to suit your risk tolerance and market conditions is essential. Combining the MACD with other <a href="https://gainium.io/help/category/technical-indicators">technical indicators</a> and fundamental analysis can further improve the effectiveness of your trading bot and contribute to a well-rounded investment approach.</p>

In this article, we explain what is the Moving Average Convergence Divergence (MACD) indicator and how it can be used in bot trading.

Moving Average Convergence Divergence (MACD)

<p>In the rapidly changing world of cryptocurrency trading, traders are continually seeking effective tools and strategies to gain an edge in the market. One such tool is the Relative Strength Index (RSI), a widely-used technical indicator that can help identify potential entry and exit points in a trade. In this article, we'll explore the basics of RSI, how it can be applied to the BTC/USDT trading pair, and example strategies to help you maximize your profits.</p><h2>The Relative Strength Index (RSI)</h2><p>Developed by J. Welles Wilder, the Relative Strength Index or RSI, is one of the most popular indicators used by traders to measure the momentum strength of an asset price action. The RSI indicator calculates the ratio of upward price movements (trader's bids) to downward price movements over a given period, typically 14 days. (As crypto is a very volatile market, the default setting in Gainium is 7).&nbsp;</p><p>The RSI is typically interpreted using two key threshold levels: 30 and 70. When the RSI falls below 30, the asset is considered oversold, signaling a potential buying opportunity. Conversely, when the RSI rises above 70, the asset is considered overbought, indicating a possible selling opportunity. Additionally, the RSI can be used to identify trend reversals through bullish and bearish divergences.</p><h2>Using RSI in Gainium</h2><p>You can select this indicator by selecting “Technical Indicators” from the drop-down menu first, then “RSI” in the “Indicator” Section.</p><figure class="image image_resized" style="width:50.64%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_11_at_17_23_03_54b9344e4a.png" alt="Screenshot 2023-04-11 at 17.23.03.png"><figcaption>RSI</figcaption></figure><p>&nbsp;</p><p>&nbsp;</p><p>&nbsp;</p><p>&nbsp;</p><p>RSI Strategy for BTC/USDT: RSI Breakouts<br>An RSI breakout strategy involves monitoring the RSI for breakouts from established support and resistance levels. For instance, if the RSI for BTC/USDT has been fluctuating between 40 and 60 for an extended period, a breakout above 60 or below 40 could signal the start of a new trend.</p><p>In this scenario, if the RSI breaks out above 60, a trader might consider opening a long position, anticipating a continuation of the upward trend. Alternatively, if the RSI breaks down below 40, a short position could be warranted, with the expectation of a downward trend.</p><h2>Using RSI in crypto bot trading</h2><p>Examples of how to use RSI indicator in your bot trading strategies.</p><h3>Classic Overbought and Oversold</h3><p>One of the simplest and most popular strategies using the RSI is to trade based on overbought and oversold conditions. In the case of the BTC/USDT trading pair, traders can monitor the RSI for levels above 70 or below 30.</p><p>For example, if the RSI for BTC/USDT falls below 30, this could signal that Bitcoin is oversold against Tether and may be due for a price rebound. In this case, a trader might consider opening a long position in anticipation of a price increase. Conversely, if the RSI rises above 70, this could suggest that Bitcoin is overbought and may be due for a price correction. Here, a trader might consider opening a short position to capitalize on the potential price decline.<br>&nbsp;</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_11_at_18_19_53_44a8a1caf0.png" alt="Screenshot 2023-04-11 at 18.19.53.png"><figcaption>Sell when RSI above 70</figcaption></figure><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_11_at_18_20_31_69136710d4.png" alt="Screenshot 2023-04-11 at 18.20.31.png"><figcaption>Buy when RSI is below 30</figcaption></figure><h3>Trend Confirmation</h3><p>Traders may use the RSI indicator to confirm trends. For example, if the RSI value is rising along with an uptrend in price, it can indicate that the trend is solid and likely to continue. If the RSI value is falling along with a downtrend in price, it can mean that the trend is strong and likely to continue. In the example below, RSI is growing from the 30ies crossing up the 50ies in a very smooth organic way and not jumping immediately over the 70ies. This indicates that there is still room for the price to go higher. In fact, there is an excellent pump right after the 50 is crossed. The RIS value of 50 is often used to see if the trend will continue or if the price will be rejected.<br>&nbsp;</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_11_at_18_25_55_adc72a10ca.png" alt="Screenshot 2023-04-11 at 18.25.55.png"><figcaption>Continuation of a trend</figcaption></figure><h3>Divergence Trading</h3><p>Another effective RSI-based strategy is divergence trading. A bullish divergence occurs when the price of an asset forms lower lows, while the RSI forms higher lows, suggesting that the selling pressure is weakening and a potential trend reversal is imminent. In contrast, a bearish divergence occurs when the price forms higher highs, while the RSI forms lower highs, indicating that buying pressure is decreasing and a potential trend reversal is on the horizon.</p><p>For example, if a trader identifies a bullish divergence between the BTC/USDT price and RSI, they might consider opening a long position in anticipation of an upward price movement. Conversely, a short position may be more appropriate if a bearish divergence is observed.<br>&nbsp;</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_11_at_18_32_54_34679fd994.png" alt="Screenshot 2023-04-11 at 18.32.54.png"><figcaption>RSI divergence</figcaption></figure><h3>RSI Breakouts</h3><p>An RSI breakout strategy involves monitoring the RSI for breakouts from established support and resistance levels. For instance, if the RSI for BTC/USDT has been fluctuating between 40 and 60 for an extended period, a breakout above 60 or below 40 could signal the start of a new trend.</p><p>In this scenario, if the RSI breaks out above 60, a trader might consider opening a long position, anticipating a continuation of the upward trend. Alternatively, if the RSI breaks down below 40, a short position could be warranted, with the expectation of a downward trend.</p><h3>Indicator combinations</h3><p>Using RSI with another indicator for confirmation. The most popular combination is with <a href="https://gainium.io/help/macd">MACD</a>. To use RSI and MACD together, you could look for situations where the RSI indicates an oversold or overbought condition while the MACD gives a bullish or bearish signal. For example, Oversold with Bullish MACD: If the RSI is below 30 and the MACD line crosses above the signal line, it could be a signal to buy. Overbought with Bearish MACD: If the RSI is above 70 and the MACD line crosses below the signal line, it could be a signal to sell, as seen in the examples below.</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_11_at_18_47_35_8c86a73b00.png" alt="Screenshot 2023-04-11 at 18.47.35.png"><figcaption>Buy SIgnal</figcaption></figure><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_11_at_18_45_50_4a96aee288.png" alt="Screenshot 2023-04-11 at 18.45.50.png"><figcaption>Sell Signal</figcaption></figure><h2>Conclusion</h2><p>The Relative Strength Index (RSI) is a powerful and versatile technical indicator that can provide valuable insights for cryptocurrency traders. Combining these strategies with proper risk management techniques is crucial to protect your portfolio and maximizing profitability.</p>

In this article, we explain what is the RSI indicator and how it can be used in bot trading.

Relative Strength Index (RSI)

<p>In the fast-paced world of cryptocurrency trading, having access to the right tools and strategies can make all the difference. TradingView, a popular platform among traders, offers an array of technical indicators, including its unique Technical Ratings Indicator. This comprehensive tool can provide valuable insights for traders and help them make informed decisions. In this article, we'll explore the basics of the Technical Ratings Indicator and example bot-trading strategies to help you maximize profits.</p><h2>TradingView's Technical Ratings Indicator: An Overview</h2><p>TradingView Technical Ratings are designed to help traders quickly evaluate the technical strength of a particular asset or instrument. These ratings are based on a combination of popular technical indicators, such as moving averages, oscillators, and pivot points. The ratings range from "Strong Sell" to "Strong Buy," and can provide traders with a quick visual representation of the technical health of an asset. You can find a detailed explanation of each indicator used <a href="https://www.tradingview.com/support/solutions/43000614331-technical-ratings/">here</a>.</p><p>It's essential to remember that Technical Ratings should not be used in isolation as a basis for trading decisions. Instead, they should be used with other technical analysis tools, such as chart patterns, support and resistance levels, and market trends, to make informed trading decisions.</p><h2>Using Tradingview Techincal Ratings in Gainium</h2><p>You can select this indicator by selecting “Technical Indicators” from the drop-down menu first, then “Tradingview Analysis” in the “Indicator” Section.</p><figure class="image image_resized" style="width:49.93%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_11_at_18_51_59_09012eb084.png" alt="Screenshot 2023-04-11 at 18.51.59.png"><figcaption>Tradingview Analysis</figcaption></figure><p>&nbsp;</p><h2>Utilizing TV Technical Ratings in Crypto Trading</h2><p>The Technical Ratings Indicator can be an invaluable tool for crypto traders, providing a quick and easy way to gauge an asset's technical health. Thanks to this indicator, traders can make more informed decisions regarding entry and exit points, risk management, and overall market analysis.</p><h3>Following the Technical Ratings</h3><p>Suppose you're interested in trading ETH and already bullish on the token's fundamentals. You want to confirm the current bullish trend in the asset using technical analysis. You can check the Technical Ratings for ETH on TradingView and see that it's currently rated as "Strong Buy" or “Buy.” This confirms your bullish outlook as the Buy is also on a very high timeframe (daily in the image below) and gives you additional confidence to enter a long position on ETH.<br><br>Here's how you can find them:</p><ul><li>Search for the asset or instrument you're interested in trading on TradingView.</li><li>Select the Technical Ratings tab on the left-hand side of the chart.</li><li>Take a look at the Technical Ratings to get an idea of the overall sentiment for the asset.</li><li>Check out the specific indicators that are being used to generate the ratings. These can be found by hovering over the rating itself.</li><li>Use the ratings as a starting point to assess the technical strength of the asset. In the example below the overall summary indicates that is an uptrend “Buy” on the 1-day timeframe</li><li>Combine the Technical Ratings with other technical analysis tools, such as support and resistance levels and chart patterns, to make informed trading decisions.<br>&nbsp;</li></ul><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_11_at_19_26_57_ad0ed441cf.png" alt="Screenshot 2023-04-11 at 19.26.57.png"><figcaption>Eth Technical Ratings in Treadingview</figcaption></figure><h3>Combining Technical Ratings with Key Levels</h3><p>Another strategy combines the Technical Ratings Indicator with critical support and resistance levels. In this approach, traders can use the overall rating to gauge the market's direction while utilizing support and resistance levels to identify optimal entry and exit points.</p><p>For example, a trader might consider opening a long position if the Technical Ratings Indicator rates BTC/USDT as a "Buy" and the price is approaching a strong support level. On the other hand, if the rating is a "Sell" and the price is nearing a significant resistance level, a short position might be more appropriate.</p><h3>Divergence and Confluence</h3><p>Incorporating the Technical Ratings Indicator into a divergence and confluence strategy can also be highly effective. Traders can monitor the indicator for signs of divergence between the overall rating and the price action, signaling a potential trend reversal.</p><p>For example, if the Technical Ratings Indicator rates BTC/USDT as a "Strong Buy" while the price is forming lower lows, this bullish divergence could indicate that a trend reversal is imminent. Conversely, if the rating is a "Strong Sell" while the price is forming higher highs, a bearish divergence may suggest an upcoming trend reversal.</p><h3>Contrarian trading</h3><p>Let's say you're interested in contrarian trading, which involves taking positions opposite the prevailing market sentiment. You can use Technical Ratings to identify currently overbought or oversold assets. For example, you might see that Apecoin (APE) is rated as a "Strong Buy," but it has been in a strong uptrend for a while. You might consider taking a short position on APE, anticipating that the trend is due for a correction.</p><p>Technical Ratings are primarily based on lagging indicators, so by the time you see “Strong Buy,” it might be the right time to short, especially if you are looking at the ratings on a very small timeframe. The images below show that Tradingview ratings printed 'Strong Buy" in the 1-minute timeframe. However, zooming out, you can see that APE has been on a strong run for quite a while and it might not be a good idea to take a Long Position, even if just for a quick scalp when the RSI is about to top the 70ies again.</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_11_at_19_37_39_a8c0fefade.png" alt="Screenshot 2023-04-11 at 19.37.39.png"><figcaption>Strong Buy on 1 minute</figcaption></figure><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_11_at_19_38_06_b5b5e7c835.png" alt="Screenshot 2023-04-11 at 19.38.06.png"><figcaption>1-hour timeframe</figcaption></figure><h3>Combining other indicators&nbsp;</h3><p>The examples of the previous scenario already highlight how useful it is to use other indicators before entering a trade. As a general rule relying only on TradingView analysis for bot trading is quite risky, and you might want to use other indicators to filter out bad entries. In the example above, you might want to add an RSI filter not to enter any long position when the value is above 70 on a higher timeframe.</p><p>The same principle can be applied to short bot entries. You might want not to enter any short position when “Sell” and/or “Strong Sell” occur on a low timeframe if the RSI on a 1-hour timeframe is below 30. In the example below, you would rather ignore entering a short position on the 9th of April when the indicator prints “Strong Sell” on the 5 min chart. If you zoom out and check the RSI in a 1-hour timeframe, the asset is already oversold, and it's unlikely it will continue dropping further.<br>&nbsp;</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_11_at_19_55_54_44ff429dcb.png" alt="Screenshot 2023-04-11 at 19.55.54.png"><figcaption>Strong Sell on 5 minute</figcaption></figure><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_11_at_19_56_23_79430420a3.png" alt="Screenshot 2023-04-11 at 19.56.23.png"><figcaption>1-hour timeframe</figcaption></figure><h3>Asset comparison&nbsp;</h3><p>If you're trying to decide between two assets to invest in the long term, you can compare their Technical Ratings on TradingView. For example, let's say you're trying to choose between BTC and ETH. You can look at the Technical Ratings for each asset and see that BTC is rated as "Neutral" while ETH is rated as a "Strong Buy". This may influence your decision to invest in ETH instead of BTC.</p><h2>Conclusion</h2><p>TradingView's Technical Ratings Indicator is a powerful tool that can provide crypto traders with valuable insights and help them make more informed decisions. Remember, always combine the Technical Ratings Indicator with other technical and fundamental analysis tools to gain a more comprehensive understanding of the market and ensure a well-rounded approach to your trading. As with any strategy, proper risk management and discipline are crucial for maximizing profitability and protecting your portfolio.</p><p>&nbsp;</p>

In this article, we explain what is the Tradingview Technical Ratings indicator and how it can be used in bot trading.

Tradingview Technical Ratings (TV)

<p>In the fast-paced cryptocurrency trading world, traders are continually looking for effective tools and strategies to gain an edge in the market. One such tool is the Stochastic indicator, a widely-used technical indicator that can help identify potential entry and exit points in a trade. In this article, we'll explore the basics of RSI, and how it can be applied to bot strategies to help you maximize your profits.</p><h2>The Stochastic Indicator</h2><p>George Lane created the Stochastic Oscillator indicator in the late 1950s. Lane was a technical analyst and trader who developed the indicator to measure the momentum of price movements. The Stochastic Oscillator is now one of the most popular technical indicators traders use worldwide.</p><p>The Stochastic indicator is used to measure the momentum of a financial asset's price. It compares the asset's closing price to its price range over a set period of time, typically 14 periods, and provides signals of potential price reversal points based on oversold or overbought conditions. The indicator is based on the assumption that as prices increase, the closing price tends to be closer to the high price, and as prices decrease, the closing price tends to be closer to the low price.</p><p>The indicator consists of two lines, K and D, which oscillate between 0 and 100. The K line represents the current closing price relative to the price range over a set period, while the D line is a moving average of the K line. When the K line crosses above the D line, it indicates that the price may continue to rise. Conversely, when the K line crosses below the D line, it indicates that the price may continue to fall (you can see the two lines in the image below)</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_12_at_16_13_15_c6fffe34ca.png" alt="Screenshot 2023-04-12 at 16.13.15.png"><figcaption>K and D oscillators</figcaption></figure><p>This indicator is very similar to <a href="https://gainium.io/help/rsi">RSI</a>. RSI is more suitable for trending markets, while Stoch is best during a sideway market.</p><h2>Using Stochastic RSI in Gainium</h2><p>You can select this indicator by selecting “Technical Indicators” from the drop-down menu first, then “Stoch” in the “Indicator” Section.</p><figure class="image image_resized" style="width:50.29%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_12_at_15_51_20_cdb5dfb854.png" alt="Screenshot 2023-04-12 at 15.51.20.png"><figcaption>Stochastic&nbsp;</figcaption></figure><h2>Implementing Stochastic in Your Trading Bot Strategy</h2><h3>Identifying overbought and oversold levels</h3><p>Traders often use the Stochastic indicator to identify potential overbought and oversold conditions in an asset's price. When the indicator is above 80, the asset is overbought; when the value is below 20, it is oversold. Traders may look for potential buying opportunities when the indicator is oversold and potential selling opportunities when it is overbought. In the image below, you can see how the price reacts after the indicator crosses up 20 or crosses down 80.&nbsp;<br>&nbsp;</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_12_at_16_24_38_a7bccc68a4.png" alt="Screenshot 2023-04-12 at 16.24.38.png"><figcaption>Buy and Sell Signals</figcaption></figure><h3>Crossovers</h3><p>Traders may also look for crosses between the K and D lines of the Stochastic indicator. For example, a bullish signal may be generated when the K line crosses above the D line, indicating that the momentum of the price is shifting upward. So you might want to start a long DCA bot when the K variable is crossing up D or start a short DCA or take profit when the K variable is crossing down D. You can see how the price reacts after the variables also cross in the image above when we talk about Overbought and Oversold Levels.</p><h3>Divergencies</h3><p>Traders may also use the Stochastic indicator to identify potential divergences between the indicator and the price of an asset. For example, if an asset's price is making higher highs while the Stochastic indicator is making lower highs, it may indicate that the price will soon reverse course and begin to fall. Divergencies are pretty powerful, especially in larger timeframes. As you can see in the image below, the price decreases quite soon after the divergence occurs.</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_12_at_16_30_42_d6b7f41705.png" alt="Screenshot 2023-04-12 at 16.30.42.png"><figcaption>DIvergencies</figcaption></figure><h2>Conclusion</h2><p>The Stochastic indicator is best used in conjunction with other indicators for confirmation. This indicator can generate false signals, particularly in a trending market, and it can give different signals depending on the time frame used. Gainium offers a great <a href="https://gainium.io/help/backtesting-trading-bots">backtesting</a> tool: testing and fine-tuning the parameters to suit your risk tolerance and market conditions is essential.</p>

In this article, we explain what is the Stochastic indicator and how it can be used in bot trading.

Stochastic

<p>Traders continually seek practical tools and strategies to gain an edge in the market. One such tool is the Stochastic RSI Indicator, a widely-used technical indicator that can help identify potential entry and exit points in a trade based on momentum price. In this article, we'll explore the basics of the indicator and how it can be applied to help you maximize your profits.</p><h2>The Stochastic RSI Indicator (stoch rsi)</h2><p>The Stochastic RSI (Relative Strength Index) indicator is a technical analysis tool used to measure the momentum of an asset's price. It is based on the traditional RSI indicator but adds the Stochastic oscillator's sensitivity to price movements. The Stochastic RSI combines two popular indicators to create a more sensitive indicator better suited for short-term trading. You can learn more about the stochastic oscillator formula and RSI in these other articles: <a href="https://gainium.io/help/stoch">Stochastic</a>, and <a href="https://gainium.io/help/rsi">RSI</a>.</p><h2>Using Stochastic RSI in Gainium</h2><p>You can select this indicator by selecting “Technical Indicators” from the drop-down menu first then “StochRSI” in the “Indicator” Section.</p><figure class="image image_resized" style="width:49.76%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_12_at_15_51_36_0a418f2984.png" alt="Screenshot 2023-04-12 at 15.51.36.png"><figcaption>StochRSI</figcaption></figure><p>In this indicator, the Rsi is represented by the variable K on the chart and the Stochastic by the variable D, as shown in the image below when you open the “Style” tab within the indicator's settings.</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_14_at_16_40_54_39ddf7e9eb.png" alt="Screenshot 2023-04-14 at 16.40.54.png"><figcaption>K and D variables</figcaption></figure><h2>Implementing Stochastic RSI in Your Trading Bot Strategy</h2><p>This indicator is very similar to the stochastic oscillator indicator, and it can be used in a very similar way.</p><h3>Classic Overbought and Oversold</h3><p>Traders may use the Stochastic RSI to identify overbought and oversold conditions in an asset's price. For example, if the indicator is above 80 (red arrow in the image below), it may indicate that the asset is overbought. If it's below 20 (green arrow in the chart below), it may mean that the asset is oversold. Traders might use these levels to start a bot or take profit, depending on their strategy.<br>&nbsp;</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_14_at_16_31_47_1d6e34b903.png" alt="Screenshot 2023-04-14 at 16.31.47.png"><figcaption>Overbought and Oversold levels</figcaption></figure><h3>Divergencies</h3><p>Traders might also use the Stochastic RSI to identify divergences between the indicator and the asset's price. For example, if the asset's price is making higher highs while the Stochastic RSI is making lower highs, it may suggest that the asset's price is losing momentum and could be due for a reversal. Traders might use this information to enter or exit positions. As you can see in the image below the price decrease not very long after the divergence occurs.<br>&nbsp;</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_14_at_16_34_55_7c22482a9e.png" alt="Screenshot 2023-04-14 at 16.34.55.png"><figcaption>Divergencies</figcaption></figure><h3>Crossovers</h3><p>Traders may also use crossovers of the Stochastic RSI and its signal line to identify potential buy or sell signals. For example, if the RSI (K) crosses above the Stochastic (D), it may indicate a bullish signal, and if it crosses below, it may indicate a bearish signal. Traders might use these crossovers to enter or exit positions.<span style="background-color:rgb(255,255,255);color:rgb(33,37,41);font-family:Montserrat, sans-serif;"> For example, you might want to start a long DCA bot when the K variable is crossing up D or start a short DCA or take profit when the K variable is crossing down D. In the example below, you might even want to use the first cross down for the variable D to sell part of your position or move your stop loss higher as another cross down happens later on at a higher price.</span></p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_14_at_16_44_56_b285f22558.png" alt="Screenshot 2023-04-14 at 16.44.56.png"><figcaption>Crossovers</figcaption></figure><h2>Conclusion</h2><p>The Stochastic RSI indicator is a powerful and adaptable technical tool that can give crypto traders useful information. Combining these tactics with adequate risk management procedures is critical to preserve your portfolio and maximizing profitability. &nbsp;</p>

In this article, we explain what is the Stoch RSI indicator and how it can be used in bot trading.

Stochastic RSI

<p>Understanding the core concepts of market analysis is crucial for your success as a trader. Among the most fundamental concepts are support and resistance, which can help traders identify potential entry and exit points, manage risk, and develop profitable strategies. This article will explore the nature of support and resistance, their significance in crypto trading, and how traders can leverage these concepts to create automated trading strategies.</p><h2>Understanding Support and Resistance</h2><p>Support and resistance levels are price points at which supply and demand interact, creating a temporary balance between buyers and sellers. These levels act as psychological barriers in the market, often resulting in significant price reactions.</p><p>Support is a price level where buying pressure is strong enough to prevent further price declines. It represents a point at which demand for the asset is substantial enough to halt the downward trend and potentially reverse it. On the other hand, resistance is a price level where selling pressure is strong enough to prevent further price increases. It indicates a point at which the supply of the asset is significant enough to stop the upward trend and potentially reverse it.</p><h2>The Significance of Support and Resistance in Crypto Trading</h2><p>Support and resistance levels play a crucial role in crypto trading. They can help traders make informed decisions about market entry and exit points, stop-loss placements, and overall risk management. Traders can use support and resistance to:</p><ul><li>Predict potential price reactions and reversals</li><li>Identify optimal entry and exit points for trades</li><li>Manage risk through strategic stop-loss placements</li><li>Develop effective trading strategies based on market structure</li></ul><h2>Identifying Support and Resistance Levels</h2><p>There are several methods for identifying support and resistance levels in crypto trading, including:</p><ul><li><strong>Historical Price Data</strong>: By examining an asset's price history, traders can identify price levels where the asset has previously reversed or experienced significant price reactions. These levels may continue to act as support or resistance in the future.</li><li><strong>Psychological Levels</strong>: Round numbers and key price milestones often act as psychological support and resistance levels. For example, prices like $10,000, $20,000, or $50,000 may attract increased buying or selling pressure due to their psychological significance.</li><li><strong>Technical Analysis Tools</strong>: Various technical analysis tools, such as trend lines, Fibonacci retracement levels, and moving averages, can help traders identify potential support and resistance levels.</li></ul><h2>Understanding the Support and Resistance Technical Indicator</h2><p>The support and resistance indicator is a custom indicator that plots support and resistance levels with breaks on the price chart. It helps users visualize key price levels where price reversals or breakouts might occur. This indicator is implemented using <a href="https://www.tradingview.com/script/JDFoWQbL-Support-and-Resistance-Levels-with-Breaks-LuxAlgo/">this script</a>, which takes advantage of the pivothigh and pivotlow functions applied to a number of left and right bars to determine at which price level the asset reverted.</p><h2>Using the Support Resistance indicator in Gainium</h2><p>You can select this indicator by selecting “Technical Indicators” from the drop-down menu first, then “Support Resistance” in the “Indicator” Section.</p><figure class="image image_resized" style="width:50.64%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_14_at_16_52_04_8a96f0f886.png" alt="Screenshot 2023-04-14 at 16.52.04.png"><figcaption>Support Resistance Indicator</figcaption></figure><p>The Support Resistance indicator in Gainium allows you to identify buying and selling pressure levels by selecting the condition and value within a specified timeframe. When price action is crossing down the support, the more likely the move is going to continue in that direction. This indicator is a perfect tool to spot a change in market behavior. On the contrary, when the price crosses up the resistance, it indicates a bullish sentiment.<br><br>The support and resistance indicator is a visual tool that you can use to identify key levels of support and resistance on a price chart based on past price action. You can change the support and resistance levels by increasing the number of “Left bars” and “Right bars,” making the levels more conservative as the tool will have more candles to calculate the prices to generate support and resistance. If you decrease them, the levels will be less strong (fewer candles in the calculation). The default is set to 15 on a 1-hour timeframe.&nbsp;</p><h2>Implementing Support Resistance in Your Trading Bot Strategy</h2><h3>Breakout Trading</h3><p style="margin-left:0px;">One popular trading strategy that uses support and resistance levels is breakout trading. Traders look for instances where the price breaks through a key support or resistance level and then enters a new trend. For example, if the price has been trading in a range for an extended period of time and then breaks through a strong support level, a trader may consider entering a short position because the asset's price is likely to continue higher. In the image below, you might want to start a short bot when the support is broken (red arrow).<br>You can also use support and resistance levels to identify potential trade exit points. In the same example below, if you have previously entered a short position and the price approaches a strong resistance level, you may consider taking profits or exiting the trade altogether.</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_14_at_17_42_46_bd91e31a99.png" alt="Screenshot 2023-04-14 at 17.42.46.png"><figcaption>Breakout</figcaption></figure><h3>Range Trading and risk management</h3><p style="margin-left:0px;">Another trading strategy that uses support and resistance levels is range trading. Traders look for instances where the price trades within a defined range between two key support and resistance levels. Traders may enter long positions when the price approaches the support level and short positions when the price approaches the resistance level. In the example below, you can open a long and short position whenever the price hits the support and resistance level ( yellow line). However, eventually the price will break up or down (yellow cross), so you will need to have a stop loss in place for your risk management. You can use support and resistance levels themselves to manage risk. For example, if you have entered a long position and the price approaches a strong resistance level, they may use this level to set a stop-loss order to protect against potential losses.</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_14_at_17_47_36_0574788df0.png" alt="Screenshot 2023-04-14 at 17.47.36.png"><figcaption>Range Trading</figcaption></figure><h2>Conclusion</h2><p>The support and resistance indicator can be a powerful tool for traders to identify potential trading opportunities and manage risk. However, traders should use multiple sources of information and confirm the validity of support and resistance levels before making trading decisions. <a href="https://gainium.io/backtesting">Backtesting</a> is essential to fine-tune your strategy.</p>

In this article, we explain what is the Support Resistance indicator and how it can be used in bot trading.

Support and Resistance Indicator

<p>Indicators play a crucial role in bot trading as they help bots to identify potential buy and sell signals in the market based on historical price and volume data. Indicators such as the Money Flow Index (MFI) help traders and investors understand the underlying trend and momentum of the asset. In this article, we'll look into the effective use of the MFI indicator in your automated trading strategy.</p><h2>The Money Flow Index Indicator</h2><p><br>Gene Quong and Avrum Soudack created the Money Flow Index (MFI) in the late 1990s. Quong and Soudack were technical analysts who worked for the financial services firm Shearson Lehman Brothers at the time. They developed the MFI as a tool to measure buying and selling pressure in the market by using a combination of price and volume data. &nbsp;It is calculated by taking the typical price (average of high, low, and close prices) for each period and multiplying it by the volume. The positive and negative money flows are then calculated based on whether the typical price is higher or lower than the previous period. The MFI is then calculated using a ratio of positive to negative money flows.&nbsp;</p><p>The MFI has since become a popular technical analysis indicator traders and investors use to identify trends and potential buy and sell signals. It is widely available on most charting platforms and trading software.</p><p>The MFI indicator ranges from 0 to 100. When the MFI exceeds 80, it indicates an overbought condition; when it falls below 20, it indicates an oversold condition. When the MFI value is above the value of 80 or below the value of 20, there is a higher chance that the trend could reverse. Therefore MFI is a great indicator to generate buy and sell signals in bot trading strategies.</p><h2>Using The Money Flow Index in Gainium</h2><p>You can select this indicator by selecting “Technical Indicators” from the drop-down menu first, then “Money Flow Index” in the “Indicator” Section.</p><figure class="image image_resized" style="width:51.75%;"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_14_at_18_12_51_f570e2cb18.png" alt="Screenshot 2023-04-14 at 18.12.51.png"><figcaption>MFI&nbsp;</figcaption></figure><p><span style="background-color:rgb(255,255,255);color:rgb(33,37,41);font-family:Montserrat, sans-serif;">The MFI indicator in Gainium allows you to determine the strength of buying or selling pressure in the market.</span>&nbsp;</p><h2>Implementing Money Flow Index in Your Trading Bot Strategy</h2><p>Because the MFI closely resembles the <a href="https://gainium.io/help/rsi">RSI</a> indicator, many of the concepts that work with the RSI are also applicable to the money flow index. This also applies to the best settings. The money flow index, however, relies heavily on market volume and its direction to produce its reading, whereas the RSI only tracks market momentum as measured by the speed and change of price movements. In addition to making slightly different readings, this places the money flow index in a leading indicator position as opposed to the RSI, which is a lagging indicator. As a result, traders frequently employ the two indicators for slightly different purposes.</p><h3>Identify Overbought and Oversold conditions</h3><p>The MFI ranges from 0 to 100. A reading above 80 is considered overbought, which means that the asset is potentially due for a price correction. A reading below 20 is considered oversold, which means that the asset may be undervalued and potentially due for a price increase. In Gainium, the default value for the oversold conditions is 70. Every asset behaves differently, so you might want to adjust the values accordingly. As you can see in the image below, a short DCA bot can be started when MFI is “crossing up” the value of 70. Or, if you prefer a more conservative entry or have fewer funds for the DCA strategy, you can start a short bot when the MFI is “crossing down” the value of 70.</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_15_at_02_03_23_203f092ed5.png" alt="Screenshot 2023-04-15 at 02.03.23.png"><figcaption>Overbought example</figcaption></figure><h3>Identify Divergencies</h3><p>A divergence occurs when the MFI indicator moves in the opposite direction of the price trend. For example, if the price is making higher highs while the MFI is making lower highs, it could indicate a potential trend reversal. In the image below the price of BTC is rising; however, the MFI indicator is creating a lower high. Soon after, the price decreases.&nbsp;</p><figure class="image"><img src="https://back.gainium.io/uploads/Screenshot_2023_04_15_at_02_10_30_8e1140caad.png" alt="Screenshot 2023-04-15 at 02.10.30.png"><figcaption>MFI DIvergence</figcaption></figure><h2>Conclusion</h2><p>The MFI is often used with other technical indicators, such as moving averages, RSI, or trend lines, to provide a complete picture of market trends. It can be used to identify overbought or oversold conditions and potential trend reversals. However, like any technical indicator, it should not be used in isolation but in combination with other forms of analysis to make informed trading decisions.</p>

In this article, we explain what is the Money Flow Index (MFI) indicator and how it can be used in bot trading.

Money Flow Index (MFI)

<p>Indicators are important in bot trading because they assist bots in identifying probable buy and sell signals in the market based on past price and volume data. Indicators such as the Parabolic SAR Indicator (PSAR) assist traders and investors in understanding the asset's underlying trend and momentum. In this post, we'll look at how to use the PSAR indicator effectively in your automated trading system.</p><h2>The Parabolic SAR Indicator</h2><p>The Parabolic SAR (Stop and Reverse) is a technical analysis indicator used by traders to help identify potential trend reversals in the price of an asset, such as stocks, commodities, or currencies. The indicator was developed by J. Welles Wilder and introduced in his book "New Concepts in Technical Trading Systems" in 1978.</p><p>The Parabolic SAR indicator comprises a sequence of dots shown on a chart above or below the price bars, depending on the trend. The main purpose of the Parabolic SAR is to provide traders with potential entry and exit points and help them set trailing stop-loss orders.</p><h3>How the Parabolic SAR works:</h3><ul><li><strong>Uptrend (Bullish Trend):</strong> When the Parabolic SAR dots are plotted below the price bars, it suggests an uptrend. The dots gradually move upward and get closer to the price bars as the trend continues.<br>&nbsp;</li><li><strong>Downtrend (Bearish Trend):</strong> When the Parabolic SAR dots are plotted above the price bars, it suggests a downtrend. The dots gradually move downward and get closer to the price bars as the trend continues.<br>&nbsp;</li></ul><p>The acceleration factor (AF) and the extreme point (EP) are the two fundamental components of the Parabolic SAR calculations. The acceleration factor starts at a certain value and then increases over time, accelerating the rate at which the dots move closer to the price bars. The extreme point represents the current trend's highest or lowest low.</p><p>The formula for calculating the Parabolic SAR dots is as follows:</p><ul><li><strong>Initial SAR = Previous SAR + (Previous AF × (Previous EP - Previous SAR))</strong><br>&nbsp;</li><li><strong>Acceleration Factor (AF):</strong> Typically begins at 0.02 and rises by 0.02 every time a new extreme point is reached, with a maximum limit.<br>&nbsp;</li><li><strong>Extreme Point (EP):</strong> For an uptrend, it's the highest high of the current trend. For a downtrend, it's the lowest low of the current trend.</li></ul><h2>Using The Parabolic SAR Indicator in Gainium</h2><p>You can select this indicator by selecting “Technical Indicators” from the drop-down menu first, then “Parabolic SAR” in the “Indicator” Section.</p><figure class="image image_resized" style="width:50.81%;"><img src="/uploads/Screenshot_2023_08_09_at_21_31_21_ac55c4e9c5.png"><figcaption>PSAR indicator</figcaption></figure><p>Gainium uses the default settings of 0.02 for both AF and EP.</p><p>Depending on your trading strategy, you might want to adjust these values. For example, the Parabolic SAR settings for scalping will almost certainly require more frequent reversals than a long-term trading approach; therefore, a scalper may prefer a greater AF. Wilder discovered that the default value of 0.02 worked best for him but that any value between 0.018 and 0.021 would suffice.</p><p>By increasing the Acceleration Factor, the indicator will track the price more closely, leaving less space between the indication and the price. This means that the chart will show more trading indications and reversals. When the Acceleration Factor is reduced, the indicator moves slower, leaving greater space between the price and the indicator. There will be fewer reversals.<br><br>Maximum Acceleration functions similarly, albeit to a much lesser extent. During a significant price move, the MA limits how quickly the indicator can accelerate. Changes to this setting will have less impact than changes to the AF.</p><h2>Implementing PSAR in Your Trading Bot Strategy</h2><h3>Double PSAR &nbsp;strategy</h3><p>The Parabolic SAR can be used for trading strategies like trend following and reversal. Traders frequently use it with other technical indicators and chart patterns to confirm signals. As you can see from the image below, when PSAR crosses from above not always indicates a reversal of price and vice versa.</p><p><img src="/uploads/Screenshot_2023_08_09_at_21_50_56_b1e89ffbad.png"><img></p><p>A double parabolic SAR technique employs two periods. A higher timeframe first indicates the trend direction based on the direction of the parabolic SAR. After determining the long-term trend direction, trades are entered in a shorter timeframe but only in the direction of the longer-term trend. The hourly chart of BTC (image below), with a parabolic SAR connected, reveals that the price is currently in an uptrend. As of August 1, the price is above the indication in the image below.</p><figure class="image"><img src="/uploads/Screenshot_2023_08_09_at_22_23_01_fa33ea545c.png"><figcaption>1 hour TF</figcaption></figure><p>By adding a second PSAR on a different TF as a deal start condition, you can find a lot of different and more frequent entries for scalping as long as the higher timeframe indicates the continuation of the trend. A 5 min TF helps identify several entries and exits in the image below.<br>&nbsp;</p><figure class="image"><img src="/uploads/Screenshot_2023_08_09_at_22_27_55_f02f7633c3.png"><figcaption>5 min TF</figcaption></figure><h3>The Parabolic Sar Breakout as a Stop Loss</h3><p>To use parabolic SAR to set stop-loss levels, place your stop-loss order at the level of the most recent dot on the opposite side of the trend. If you are long, for example, you can set your stop-loss order at the level of the most recent dot below the price. This can be easily done using the SL feature in Gainium. See the image below.</p><figure class="image"><img src="/uploads/Screenshot_2023_08_10_at_21_57_21_3a8090f7da.png"><figcaption>PSAR SL</figcaption></figure><h3>PSAR and MACD crossover</h3><p>A stronger reversal can be identified using MACD indicator crossover as an additional deal start condition. In the example below, the price crossing above PSAR indicates a possible buy-long entry. By adding to the same chart the MACD crossing up, we have an additional confirmation for a long entry.</p><figure class="image"><img src="/uploads/Screenshot_2023_08_10_at_22_11_04_7c06dfc9fe.png"><figcaption>PSAR and MACD</figcaption></figure><h2>Conclusion</h2><p>The Parabolic SAR (Stop and Reverse) indicator is a valuable tool for traders seeking to identify potential trend reversals and set trailing stop-loss orders. Its simple visual representation, with dots plotted above or below price bars, helps traders gauge the direction of a trend - upward or downward. However, like any tool, the Parabolic SAR is most effective with other indicators and analysis methods, as no single indicator guarantees success. Traders must combine the Parabolic SAR with a comprehensive trading strategy and risk management techniques for more accurate and well-rounded trading outcomes.</p>

In this article, we explain what is the Parabolic SAR Indicator (PSAR) indicator and how it can be used in bot trading.