Buying the dip is easier said than done. As much as each of us would like to buy near or at the lowest price for a coin, more often than not, many of us would commit the “buy too early” mistake as the price keeps plummeting.
This is where a crypto trading bot comes in handy. Instead of trying to time the market, it is simply better to just buy the dip (“BTD”) in an objective manner. Removing emotions and FOMO (“Fear of Missing Out”) from the equation is a good first step in this BTD strategy. A crypto trading bot like CryptoHero would be able to assist a trader to execute an effective BTD strategy. A trader can configure the crypto trading bot to buy when certain indicators are flashing “oversold” conditions.
Does a BTD strategy sound like Dollar Cost Averaging (DCA)? It does because it is.
A seasoned trader would also accompany a DCA strategy by coupling Martingale accumulation to it. A Martingale strategy simply increases the number of coins to buy at each lower dip. The end effect is the average cost price would be substantially lower should the market rebound.
Hence, for any trader or even new users exploring the world of automated algorithmic trading, having a DCA crypto trading bot should be the most important consideration.
A DCA strategy can also be applied in all market conditions. Although it has limited upside when the market goes up, it will still be highly effective in a range-bound or downtrend market.
A crypto trading bot is definitely a much-needed companion.
Many of us have often bought into a position, usually due to FOMO, only to find the asset price going south. If only these moments of impatience can be governed by objective rules that determine the “optimal” entry price.
Most of us have definitely bought into an asset that is skyrocketing simply because we are impatient. We do not care when is the low and we are just afraid to lose out if the price keeps going up. More often than not, these “rash” decisions work against us.
This is the reason why a crypto trading bot is extremely essential to any trader’s tool. A good trader will always use a crypto trading bot to help enter the market at “optimal” times and this habit becomes a discipline.
A good DCA crypto trading bot can essentially be configured to buy the dips and coupled with the Martingale effect, would allow the trader to perform relatively well in either bull or bear markets. By using a crypto trading bot, a trader is assured that any trading decision is void of human emotions and is based purely on quantitative variables.
As a matter of fact, it is never a good idea to trade on your own. Having a crypto trading bot to assist you in your trading is probably the best long-term trading strategy any crypto trader should have.
It takes discipline to use a crypto trading bot through good and bad times. And having a disciplined mindset is what elevates a trader from good to great.
After all, we can never time the market, but we can always buy the dips.