How does the Grid Bot work?
In our “3Commas practical guides” article, we have already considered the basics of the Grid Bot operation. We strongly recommend that you take a look at it before reading this article!
Let us briefly recall the basics: in order to launch a GRID bot, it is enough to specify the upper and lower price limits for the Bot to operate in and the number of price line levels between them. The strategy creates a series of horizontal buy and sell levels, and the Bot accumulates profit as the price moves, “bouncing” within the grid.
What are the benefits of our GRID bot?
Bots on the crypto market mostly operate via signals to start and finish a trade, but a GRID bot is different.
A GRID bot does its best to earn on every price movement through buying lower and selling higher. When the price goes down – the Bot accumulates the chosen asset; when the price goes up – the Bot sells. It operates 24/7 until the price goes beyond the grid. All it needs is to specify the lower and upper price of the grid and the width of each level, where the Bot will buy and sell the coins.
Let’s move on to our Grid Bot settings.
To do so, go to the GRID bot page or www.tradingview.com (whatever is more convenient for you) and start viewing the charts of different coins. The goal of manual analysis and Grid Bot creation via “Manual strategy” is to find and select such trading pairs, where the price is near the support level, which is the most crucial factor for success in trading with a GRID bot.
The support level is the minimum price level for a certain period of time. As a rule, when reaching this level, the price turns around and goes up.
It is best to look for coins on the 4-hour timeframe and beyond. The most suitable coin will be the one that has gone down in price to some strong support level and is constantly repelled. That is, you can see that the buyers are buying back the “bottom” every time. Ideally, of course, we should look for a coin with greater volatility; we will have a better chance of making profits while the price moves up or down our grid.
High volatility leads to higher risks but also opens up more opportunities for earning while trading.
Having looked through the different coins and applied the basic technical analysis skills, we decided to focus on the ZRX/USDT pair.
Here are the main reasons:
- The price rebounded from the bottom of a strong support level, from which it can go up again gradually or enter a range, i.e., it will go up or down and then out of this channel. That’s exactly what we need. The goal is for the price to move within our channel and then go up. After that, we can safely close our Bot and move to the next coin;
- There is a strong Bullish divergence on the RSI indicator.
Bullish divergence is the lower lows for the price chart and the higher lows for the indicator, in this case, RSI.
- ZRX does not lead in terms of market capitalization, but together with LEND it has many more holders than other Defi tokens, which is an important indicator in trading.
So, we have 300 USDT, and we want to grid the ZRX/USDT pair. The GRID bot itself is a fairly large bot, which means that the more levels we set up, the more spare balance we will need.
Let us start setting up our Bot. Go to the 4-hour timeframe (better overview of levels) and adjust the chart so that the price goes from the bottom of our strong support level to the top of the channel where the price can move for some time inside our grid. We set the grid so that the lower and upper grids hit the lower price and the upper price of the channel. This way, the price movement in the grid will hit each level as often as possible. If the 4-hour timeframe is not convenient, you can choose a 15-minute timeframe for accuracy (it matters if the grid is not as big and its width is less than 1%).
Next, set the following parameters in the Grid Bot settings:
Upper limit price: 0.4250
Lower limit price: 0.3065
Number of grid lines: 30
Quantity in one Grid: 33 ZRX (minimum amount for each trade, just over $10)
Investment amount: 272 USD
Bot launch price: 0.3174
Grid Width: 0.96% ~ 1.31%
Total grid span: 38%
When Grid Bot settings are complete, click “Create”. Then click “OK” when receiving the “Bot successfully created” message. After that our Grid Bot is ready to work, but it is not launched yet. Check all the Bot’s settings in the “My Grid Bots” section below the chart (if necessary, you can click “Edit” and correct the settings); when you are satisfied with the setup – start! To launch the Bot, click “Enable.”
Next, the Bot will ask us again if we are sure of our actions; if so, we confirm by clicking the “Confirm” button.
And last, but not least: For Grid Bot to work, we must purchase the necessary amount of ZRX; you can do it manually using the Smart Trade terminal or simply click the “Market buy” button.
After that, our GRID Bot will start to work, i.e., it will place limit orders on the exchange, and at each price movement and execution of each limit order, it will recreate any filled orders again and again and bring profit with each price movement within our grid.
If we click on a pair in the GRID Bot settings (in our case, it is ZRX/USDT), a chart showing the grid itself and the executed orders will be opened. From time to time, when we open the chart, we will get a picture with some Bot analytics. Also, in the “My Grid Bots” section, next to your Bot data, you will see the realized profits on the right. If necessary, you can stop the Bot, wait 30-60 seconds (so that the Bot can cancel all limit orders on the exchange), make changes to the grid, save and run it again.
Also, if we click on the header of our GRID bot, it will open a page with our open position and all limit orders that are placed, the limit orders lock the funds the bot requires to operate. Also, on this page, you can export all of the data related to your Bot.
What’s the best time to exit the GRID bot?
The ideal time to stop the Bot and close it is when the price goes all the way from the bottom to the top and out of the grid. If the price went below the bottom of the grid, there basically are two options: to wait for the price to return into the grid or stop the Bot. This would mean that your wallet will hold unsold (in our case ZRX) coins. You can try to sell and profit from the coins stuck in your wallet using the Smart Trade manual terminal and the Smart Sell tool. If we have available balance in our wallet, you can use “Averaging” and end up profiting. Thus, we will get a profit both from the Grid Bot, and from the Smart Sell deal.
Let’s check our GRID Bot’s progress the next day.
As we can see from the chart, the ZRX price has gone up, and the Bot is working and making a profit. Previously, we mentioned that in order to make a significant profit on each price movement, you need to enter a larger amount than we used for example purposes. However, our Bot is performing well and shows positive results.
How do you keep track of the Bot’s performance?
At the bottom of the chart, we see the “B,” “S,” or “BS” marks.
“B” means that the Bot bought here;
“S” means that the Bot sold here;
“BS” means that the Bot bought and sold here.
In the transaction overview, we see all the income that the Bot managed to bring. If you click on “Show all transactions,” you will see a complete picture of how your Grid Bot performed.
Well, here we are! Now, having understood the work of the Grid Bot following the examples, you can easily set it up, start trading, and making profits!
And if you have not tried our platform before, now is the best time to do it!
Register with 3Commas and get three days of free access to all features, as well as a 50% discount when you buy a yearly subscription!
Disclaimer: The contents of this article are not intended to be financial advice and should not be treated as such. 3commas and its authors do not take any responsibility for your profits or losses after you read this article. The article has been presented to provide readers with general information. There is only personal experience described herein. The user must do their own independent research to make informed decisions regarding their crypto investments.
To start a grid-bot on most platforms, you'll select the coin-pair, price-range, choose the number of grid-levels in your range, and the coin quantity to buy/sell per level. The grid-bot handles everything from there, except for stopping the process.How do you use a grid bot? ›
How to set up a grid bot? You have to specify an access point, a trading pair, volume of the first and extra order, take profit percentage and step of extra order. Max Order Price field is optional. Max Order Price - you set the maximum price for bit to enter the position.Is Grid bot trading profitable? ›
Grid trading bots have the unique advantage of turning a profit in time of consolidating and choppy markets, where there tends to be a lot of indecision and confusion. Every now and then markets trade within a range, though they might still move wildly within that range.When should I start a grid bot? ›
The best time for grid trading is when there are tiny price fluctuations below 2-3% daily. If the price of crypto appreciates exponentially, the bots will take profit early. If the price depreciates fast, the stop losses will be triggered.Is grid bot better than DCA bot? ›
A Grid bot works best when any particular pair is in a range with no clear up or down trend. A DCA bot reduces the impact of market volatility and maintains a cost price similar to the market average. A Grid bot allows you to profit from market fluctuations without having to hold a lot of coins.How long should you let a grid bot run? ›
You can let the grid bot run for years. However you will also want to make sure that the price of the pair is in between the upper and lower limit of the price.What is grid strategy? ›
The principle behind a successful grid trading strategy with the trend is that if the market price consistently moves in one direction, your position to capitalize on it gets larger. As the price rises, the grid triggers more buy orders causing your position to grow.How does the bot app work? ›
A bot is a software application that is programmed to do certain tasks. Bots are automated, which means they run according to their instructions without a human user needing to manually start them up every time. Bots often imitate or replace a human user's behavior.Can grid bot lose money? ›
This scenario will happen when the current price is lower than your bot's average holding cost. While negative unrealized profit is greater than the grid profit, your total profit will therefore become negative. In this case, you will suffer some loss of your initial investment when you close the bot.When should I stop grid trading bots? ›
If you feel the cryptocurrency being traded is likely to suffer a further drop in price, then you may wish to stop the Grid Bot and create a Smart Cover trade to sell the cryptocurrency at the current chart price and buy it back lower, when it has found a bottom, before creating a new Grid Bot with a different range to ...
Profit per Grid (Profit/Grid)
Profit/Grid is the profit percentage after matching the Buy and Sell Orders on each Grid. Depending on the trading mode (Arithmetic or Geometric), you can calculate the Profit/Grid by the Grid's Upper Limit, the Grid's Lower Limit, the number of Grids, and the trading fees (c): 0.1%.
The problem with the against-the-trend grid is that the risk is not controlled. The trader could end up accumulating a larger and larger losing position if the price keeps running in one direction instead of ranging.Which crypto is best for grid trading? ›
- BTC/ETH. This is by far the most used trading pair in the crypto industry on literally every exchange. ...
- BTC/BNB. Another great pair with high liquidity and enough volatility to make grid trading possible. ...
- ETH/BNB. ...
- BTC/SOL. ...
- ETH/SOL. ...
- Pionex. ...
- Binance Grid trading bot. ...
This activity is also referred to as ticket scalping. The BOTS Act outlawed the resale of tickets purchased using bot technology and set a fine of $16,000 for violations of the act, which is enforced by the U.S. Federal Trade Commission.Is it illegal to have bots? ›
While using automated bots to buy goods online often violates the retailer's terms and conditions, there are currently no laws against using bots to buy sneakers or other retail goods. Purchasing and reselling tickets using bots became illegal in 2016 after the U.S. BOTS Act passed.Is it easy to create a bot? ›
Most bots are fairly simple in design, but some bots are more complex and use artificial intelligence (AI) in an attempt to imitate human behavior. Writing a bot is fairly easy for most developers, and sometimes even for non-developers.What is grid bot strategy? ›
Grid trading bots are automated trading tools that adopt the grid trading strategy, a trading system that allows you to profit by placing a series of long or short orders at predetermined intervals around a set price, creating a trading grid.Is more grids better for grid bot? ›
When you have more grids in a limited range, you'll have higher possibility to executed your orders but less profit per grid. When you have less grids in a limited range, you'll have lower possibility to executed your orders but more profit per grid.What is the best arbitrage bot? ›
1) Cryptohopper – Best for Copy arbitrage trading and Fixed Fee Option. Cryptohopper is a crypto arbitrage bot that helps you to manage all crypto exchange accounts in one place. You can use this arbitrage bot to earn money by exploiting the differences in value between multiple trading pairs on the same exchange.Is Binance Grid bot profitable? ›
Grid trading is one of the latest features that Binance Futures has introduced to help you make the most out of the cryptocurrency market. It is designed to work autonomously under a few preset parameters, allowing you to profit even from small price fluctuations.
The solution to your problem is the Cloud. Cloud is just a remote computer which runs your bot 24/7. There are tons of services available for remote hosting. I will advise you to use heroku because it's free and when you get some experience in cloud hosting, you can buy better dedicated VPS by spending some money.What is the difference between martingale and grid bot? ›
The biggest difference between the Martingale Bot and the Grid Trading bot is that Martingale bot will laddering buy and sell all at one time; while Grid Trading Bot will laddering buy and laddering sell.What are the 5 stages of grid? ›
The five stages of grief are denial, anger, bargaining, depression and acceptance. Swiss-American Psychiatrist Elisabeth Kübler-Ross wrote about it in her 1969 book, On Death and Dying. That's why the five stages of grief are sometimes called the Kübler-Ross model.What is grid method example? ›
Able to multiply a one-digit number by a multiple of ten (for example: 5 x 70, 2 x 30, 4 x 80 etc.) Able to multiply two multiples of ten (for example: 50 x 20, 80 x 30, 60 x 40 etc.) A reliable written method for adding four numbers (some three-digit)Do bots make money? ›
Another way to make money from your bots is by getting paid for them through paid work platforms like Google Adsense or Facebook Ads. These platforms pay out small sums of money each time someone clicks on an ad that was created by a bot built with their platform.How can you tell if someone is using bots? ›
The most common way to tell if an account is fake is to check out the profile. The most rudimentary bots lack a photo, a link, or any bio. More sophisticated ones might use a photo stolen from the web, or an automatically generated account name. Using human language is still incredibly hard for machines.How does automated bot work? ›
Bot automation relies on software robots to interact with applications, systems, and workflows, streamlining a wide-range of business processes without human intervention. Bots do not replace human workers, but handle tedious processes, so your employees can focus on more strategic, value-added initiatives.How much profit can a trading bot make? ›
On a low-volatility trading day, the stock could move between 0.6 and 1 percent. If the bot doesn't lose any trades in this kind of trading month, the trader could potentially earn 20% each month for an all-in strategy. This means that an account with $10,000 will earn up to $2,000.What is the success rate of trading bot? ›
Some lower-risk crypto trading bots boast a 99% success rate, while others execute higher-risk strategies and have a lower success rate. The main thing most investors need to consider is whether the bot they're looking at can execute their specific investment strategy successfully.What time frame do most traders use? ›
Best time frames for day trading
Using 15-minute time frames is useful to day traders because their aim is to enter and exit positions multiple times per hour/day. The primary market trend can be established using 60-minute time frames. From there, time frames of 15 minutes can be used to establish short-term trends.
What is a Good Profit Margin? You may be asking yourself, “what is a good profit margin?” A good margin will vary considerably by industry, but as a general rule of thumb, a 10% net profit margin is considered average, a 20% margin is considered high (or “good”), and a 5% margin is low.What is grid pricing? ›
Grid prices, or value-based marketing, refers to pricing cattle on an individual animal basis. Prices differ according to the underlying value of the beef and by-products produced from each animal.What is the average return on Pionex? ›
This bot aims to provide a “return of 15-50% APR with extremely low risk,” and you can get started with as little as a $50 deposit.How do I start a grid trade? ›
In a grid trading, a trader first sets his starting reference price. Multiple buy orders at once are then placed below this reference price at various (usually even) levels set by the grid. Sell orders are then paired with each buy order and are set above the prices in buy orders.Why grid trading fails? ›
Grid trading is referred to as GTP because its weaknesses are revealed when markets have explosive strong trends, in which the losing trades grow faster than the winning trades and can lead to ruin if some of the trades are not closed down in time.How reliable is the grid? ›
For decades, the United States has enjoyed an electricity grid that is more than 99 percent reliable, delivering electricity consistently and effectively to millions of households across the country.Which crypto is best to earn daily? ›
#1 Ethereum (ETH)
This is the ruler of the smart contracts and dApps market in the Crypto space that grew by an astonishing 425% in price in 2021. Not only this, Ethereum offers good volatility and provides a great opportunity to attain considerable profit quickly.
Although you can trade cryptocurrencies at any time of day, the market is more active during typical work hours and less active early in the morning, at night, and on the weekends. Generally, cryptocurrency prices start low on Monday and rise throughout the week.How do you set up a Pionex grid bot? ›
- Step 1: Register Account. Register a Pionex account from the Pionex App or Pionex Website with your email or phone number. ...
- Step 2: Complete Verification. Identity Verification (KYC) ...
- Step 3: Deposit Crypto. ...
- Step 4: Buy Crypto. ...
- Step 5: Explore Pionex Trading bots.
- Step 1: Create accounts for Alpaca and Google Cloud Platform. ...
- Step 2: The Python script. ...
- Step 3: Connect Alpaca API. ...
- Step 4: Create a new email account and add email notification functionality to Python function.
You can use Stop Trigger to stop trading when the market price triggers the set prices: Stop Loss: should be less than the lower price, last price and trigger price; when the latest market price reaches the Stop Loss price, the grid will stop working.Can trading bots lose money? ›
Risk-taking Strategy of the Bot
This means that the bot either throws in all the money when it generates a buy signal or it sizes up the money and spends it according to your risk tolerance. If the bot is programmed with an all-or-nothing risk strategy, you may lose your crypto trading career in a short amount of time.
The grid can be created to profit from trends or ranges. To profit from trends, place buy orders at intervals above the set price, and sell orders below the set price. To profit from ranges, place buy orders at intervals below the set price, and sell orders above the set price.How do I set up crypto grid trade? ›
To set up the grid, the trader first needs to decide on a reference price. In the above example of a sideways market, buy orders should be set below the reference price. Each buy order has a corresponding sell order set at levels (in this case, two levels) above the buy orders.What is the most profitable bot in Pionex? ›
Grid trading bot is one of the most popular trading strategies on Pionex exchange, because Trading Bot helps users make about ten million USD profits in 2019.