This is not financial advice, this is a researcher's study/review. This article contains affiliate links. Image designed with Canva
I am one of the bright crypto traders who will smile to tell you how they've once made as much as $1,000 in a single day trading but lost it all plus more the next couple of days.
Yes, I traded with a capital lower than $1,000. Okay, my trading value at the time was $500 if I recall correctly, so I made 200% ROI in 24hrs, and guess what? It was my first day of trying out “Futures Trading”.
I thought to myself: “This Is Fun” and you can guess the next line of thoughts.
Ahhh, yes, we all dream a little sometimes.
Crypto trading, I'll be honest with you, isn't complex, it is a very simple thing to do, what is complex is understanding the financial markets, both at the surface level - the fundamentals and the advanced level leading to inner workings.
The inner workings of the financial markets are where the goldmine is, this is where rich exchangers are extracting money from, this is where insider trading is birthed and practiced, this is the center for market manipulation but also basically where big investments are made through.
It is important to understand that while market manipulation exists on a large scale, not all volumes cast the same shadow, some are just big money moving in to create bigger value.
But then, the average user/crypto trader knows nothing about the inner market workings, so we stick to what? That's right! “Technical Analysis”... You know, all that nerd talks we go on about, drawing lines on charts from here to there trying to sound smart like Max Bennett in 7th grade.
Don't get me wrong, technical analysis works, you just need to believeeeee….
Hehe, I mean, you need to know your shit and stick with it!
But then again, how many of the average traders understand technical analysis?
That's another more than half of the trading population cut off.
With the few points above, I believe some of us already know why we suck at trading, but, but, that's not the reason for writing this piece. With the breakout of artificial intelligence, there's a rather obvious trend on how the world is moving but few are paying attention.
Autonomous Software Programs Is The Future
Whilst traders made millions sandwich trading in 2022, according to a market study/report, I was busy trying to arbitrage trade 5x to make a couple hundred dollars and guess what? I didn't even realize that crypto trading bots were live and cutting my profits while I traded!
If you already use a crypto trading bot and do not have a sustainable profit trend, then read crypto trading bots' best practices to get on the right track. For the rest, let's have a quick look at how technological trends are affecting who gets to make money as the day goes by.
You know the saying “Work smart, not hard?”
I wouldn't know any better time than now to use it to say to you, wake up, automation, via artificial intelligence is here to change the game!
The reason “we suck at trading” is because what we are up against is not humans but sophisticated and smart programs front-running the entire game.
And we as manual traders are greedy and emotionally wired.
Sure, things like product releases cause prices to pump, same with bad news, but that doesn't mean that most market environments are not tailgated. The whole idea of “sandwich trading” is to leverage smart technologies to front-run market orders and profit.
While the larger population of traders are not exposed to trading bots, the population controlling the larger pie of volumes run on bots, therefore making the competition high for average manual traders.
Remember FTX and their trading practices with Alamanda Research? Does anyone think they were manual trading? Well, that's a very bad example to give out here given that the exchanger went bankrupt but you can't blame the bot, but the strategy that was implemented.
Anyone who has used a trading bot will tell you that it's much more effective! On the Hive blockchain, a trading bot is used to maintain the HBD stablecoin value via algorithmic trading, if I'm not mistaken and this bot makes good profits daily that it autonomously sends to the Decentralized Hive Fund(DHF), a DAO on the blockchain.
Need any more proof of why we suck at trading?
To put it quite simply, most traders suck at trading not because their strategies aren't effective, but because they execute manually and sometimes, these strategies get faulted when emotions are allowed to come into the picture.
By using crypto trading bots, traders can avoid some lines of human risk and focus on software, asset security and management.
Don't have or know how to write up a program for a trading bot?
No worries, you can use commercial bots with proven records of profitability.
Cryptohopper - used by over 751,222+ traders is rich with a marketplace for various pro-traders strategies with ROIs as much as 80%.
Bitsgap is also a reputable trading bot with an average of 1.23% profit daily. The platform is used by over 500,000 traders and has completed over $300 billion volume of trades across over 3.7 million bots.
For further studies, read “Crypto Trading Bots Best Practices” to stay safe using these programs.