Why Should You Start Grid Trading Right Now?

1.What kind of trader you are, emotional one or rational one?

As an emotional investor, you tend to be panic when the market goes down sharply and crazy when the market goes wild. Rather than staying the course with long-term goals in mind, you have a greater desire to avoid the risk of uncertain loss. While rational investors win long-term. They understand it’s hard to predict or time the market. What they can do is to think in a strategic and rational way to avoid rash and emotional decisions. A successful trader is rational, analytical, able to control emotions, practical, and strategy- oriented. If you are an emotional trader, spot grid trading is the first step that you should take, which can rid you of emotional trading by strictly implementing trading strategies.

2. What Are The Advantages of Spot Grid Trading?

• Overcome your panic emotion
Spot grid trading is a trading strategy that automatically sells high and buys low within a range you specify. For example, when you think the market will fluctuate between $10 and $100, you can specify a program to buy low and sell high only within this range, as long as the market always oscillates within the grid you specify. Then you can continuously make profits from the grid without the need to operate manually, which rids you of the dilemma where you are greedy when the market looks up and feel panic when the market looks down. Spot grid trading will keep you calm and rational.

• Easy to set up
In some cases， you only have to set up three parameters, which includes lower limit price, upper limit price and the number of grids. Let's say you have a grid of 6 after you've set the range between $5,000 and $10,000. If you open a position in $7500，it will buy stop when the price is 7000, 6000 and 5000 and sell stop when the price is 9000 and 10000. By analogy, each sale order will be hung with a purchase order below the current price.

• No need to do a lot of market analysis
The logic of the grid is to throw out the net. Whether it is rising, falling or consolidation, it is always in this net. It’s unnecessary to predict where the market is going because it will go within your net anyway. There is an extreme - that is, breaking the net, which means that the market goes out of your preset grid. It could be a sharp rise or a sharp fall. What to do at this point? You can also set stop-loss and target-profit prices in the grid configurations to protect your assets before creating a grid. Therefore, you will also find that the concept of grid trading is to imagine all the situations as much as possible. As long as the condition is met, it will execute automatically.


• More profit comparing to holding
In fact, spot grid trading often has a higher yield compared with holding. Suppose you've set the range between $5,000 and $10,000, with a grid of 6. If you open a position in $7500 and the trade is terminated after selling at a price of 8000, you will gain earnings of 14% from grid trading. However, if you put into the same investment in position, you will gain earnings of 6.7%, which is less than half of grid trading.

3. How to use grid trading?


Gate.io has made creating a grid strategy easier than ever. It even offers a ‘smart grid’ model for those who don't know how to set up parameters. Create your own strategy and then choose spot grid trading in strategies Templates. Then choose the trading pair and select "Smart Grid" or "Configure Grid Manually". Suppose your trading pair is BTC/USDT, and principal is $1000 with the profit of the grid set to 1%. When the market rises to the first grid, the BTC value in your hand will come to $1010. At this time, the program will automatically sell 1% of the profit, that is, it will help you give out $10. Similarly, when it falls, the program will automatically help you buy the equivalent of 1% BTC and keep your fund the equivalent of $1000. In other words, as long as the market is still within the grid range you specify, your principal value will remain original.

Learn more:https://www.gate.io/strategybot