Top 10 Most Frequently Asked Trading Bot Questions by Newcomers

Q1: Is KuCoin Trading Bot free? What are the trading fees?

KuCoin Trading Bot is available to all KuCoin users without any additional fees. The trading fees of KuCoin Trading Bot are charged according to the following rules:

 

Spot Bot

KuCoin Trading Bot Spot strategies collect trading fees according to the Fee Rate rules of KuCoin Spot, and Trading Bot users can enjoy a 20% discount on the Maker/Taker fee rate of LV0 fee of the selected coins.

Applicable Strategies: Spot Grid, Infinity Grid, Smart Rebalance, DCA, Martingale, and all Spot strategies in the future.

Example: A user runs the KCS/USDT Spot Grid Bot. KCS belongs to the Class B of the Spot market and the Maker/Taker rate of LV0 is 0.2%, so the trading fee rate of Trading Bot is 0.16%.

Futures Bot

Futures strategies are charged at a fixed Maker/Taker trading fee rate of 0.06%.

Applicable Strategies: Futures Grid, DualFutures AI, and all Futures strategies in the future.

 

Q2: I’m a HODLER and I pursue long-term value, which Trading Bot should I choose?

HODLERs tend to hold on to a valuable asset. What they want to earn is long-term holding income, and the rate of return may be 10x or even 100x the funds.

When the market is in a downturn, although the market is sluggish and there are few opportunities, it is a good time to hoard assets, because the asset price is relatively low. Smart Rebalance Bot and DCA Bot are better strategies for hoarding assets.

DCA Bot is a regular fixed investment strategy, which is widely used in traditional financial markets such as gold and stocks. In a volatile and downward market, using an appropriate DCA strategy can play a role in amortizing the cost of buying.

Smart Rebalance Bot automatically makes intelligent dynamic position adjustments for investors in the existing asset portfolio, according to the market ups and downs, with the purpose of maximizing income, that is, optimizing the position ratio of each asset.

For example, an investor has BTC and ETH in his currency portfolio. When the price of BTC rises, the bot will automatically sell a certain amount of ETH and buy more BTC, and vice versa.

The advantage of this bot is that it can take advantage of exchange rate fluctuations between different currencies to earn coins. In this way, in the process of holding, the investor's asset funds will continue to increase, and the corresponding return will be more after the market warms up.

 

Q3: When trading in a bear market, which Trading Bot should I choose?

In the bear market, is there any chance to make a profit? Of course, there are, such as buying bottoms and earning short-term profit amid fluctuations.

However, for most users, your so-called bottom-buying may be halfway up the mountain. Or find the wrong point and direction in the volatile market. In short, the operation of the bear market is a test of skills and human nature, and most novice users may not have these potentials for the time being. In addition, the volatility during the bear market in the encryption circle is wider, which also puts forward higher requirements for traders' time and energy.

In this regard, the following Trading Bot strategies launched by KuCoin can help you better complete trading in a bear market.

1. Grid Bot: Spot Grid and Futures Grid

In a bear market, the price often jumps up and down repeatedly, and there are not many trading opportunities. And in a bear market, 70% of the market is a volatile market. Use grid trading to automatically buy low and sell high within a certain price range to earn small grid profit, and you can also get good returns.

2. DualFutures AI Bot

Rebounds and pullbacks often occur in volatile markets. DualFutures AI Bot can quickly capture the rebound and pullback trading signals based on technical indicators to open and close positions, and make profit from them, which is suitable for profit from rebounds or pullbacks after small and medium cycle trend reversals. Regardless of whether the market trend is rising or falling, it will seize trading opportunities to obtain two-way profits from long and short.

3. Martingale Bot

In the long or short-volatile market, the Martingale Bot executes continuous buying every time the price falls by a fixed percentage value and automatically executes selling after the market reverses and reaches the preset selling point. Relatively speaking, the risk is controllable and the income is stable. It is suitable for most of the market except for one-sided markets, especially the medium and long-term volatile markets.

If you want to learn more about the above Trading Bots, you can go to the KuCoin Product Crash Courses of KuCoin Learn to find the corresponding articles and read them in detail.

 

Q4: Which coins are suitable for Trading Bot?

Different types of bots are suitable for different coins.

Grid strategy, including Spot Grid, Futures Grid, Infinite Grid, etc., prefers mainstream coins such as BTC and ETH, or hot coins with a larger trading volume and high volatility. Only with a large enough trading volume can there be sufficient trading depth that would make the grid bot's orders be executed quickly. During a volatile market, the high volatility can make the Grid Bot trade frequently, obtain more arbitrage opportunities, and thus earn more profit.

The DualFutures AI Bot prefers trading pairs with high volatility and large trading volume. It will have more trading opportunities when a rebound or pullback occurs. Either mainstream coins or MEME coins can be used.

Trading bots suitable for long-term investment, including Infinite Grid, DCA, Smart Rebalance, etc., are preferred for mainstream coins or value coins with market recognition. In terms of opening a position in a bear market or bottom, and holding it until the next round of a bull market arrives, the increase of mainstream coins and value coins is bound to be the largest.

 

Q5: Is there any risk of loss in Trading Bot?

Let's be clear that Trading Bot is a tool that is designed to automatically execute specific trading strategies that may yield profit under certain market conditions. As for how to use it, which bot to use in what market, when to enter the market, and when to exit the market, every trader's decision is different.

Simply put, trading decisions are made by yourself, and Trading Bot is a good helper to assist you in executing trading decisions. Therefore, like any investment, it is not guaranteed to be profitable and there is a risk of loss of funds.

Facing the possible risk of loss, what should you do?

1. Investors should use a reasonable money management strategy, such as investing only funds that they can afford to lose, and regularly reviewing and adjusting their trading strategies.

2. Investors should also actively track market dynamics and the assets they are trading to make more timely decisions.

3. Any investment decision should be based on sufficient research and understanding. Before investing, it is necessary to work hard to do research and trading plans and seek advice from professional financial advisors when necessary.

 

Q6: How long should a Trading Bot be running?

It depends on the type of Trading Bot strategy you are running.

Long-term strategies: Smart Rebalance, DCA Bot and Infinity Grid

People who use these strategies tend to be position traders. They usually use these bots to open positions in bottoms or bear markets and let the bots run long enough to go through a bear-bull cycle. It is normal to run for several months or more than a year.

Short and medium-term strategies: Spot Grid, Futures Grid, DualFutures AI Bot and Martingale Bot

These strategies are suitable for running in the medium-term or short-term volatile market. As long as the volatile market continues, the bot can continue to run. This requires you to observe the market trend and flexibly manage the running time of the bot. It is normal to run for a few weeks or months.

The Futures Grid is also suitable for use when the short-term market fluctuates greatly. When you predict that the market will rise or fall in the future, you can create a Futures Grid in advance and choose to go long or short and close the bot in time when the profit target is reached.

 

Q7: My Spot Grid or Futures Grid has a loss, what caused it?

The reasons are as follows:

1. Spot Grid Bot enters at a high price, and then there is a one-sided fall.

2. The direction of the Futures Grid is wrong, resulting in floating losses.

3. In the volatile market, due to lack of patience, the bot was stopped ahead of time before reaching the profit position.

4. The grid parameters are not set properly, the price interval is too small and the profit is worn out by the trading fee.

So, is there a solution?

We know that the trading results are affected by the winning rate, the profit and loss ratio, and the number of trades. Therefore, improving the following three points can further increase the profit of grid trading.

1. Improve the accuracy of Futures Grid long and short selection to increase the winning rate.

2. Position management: rationally allocate positions.

3. Set appropriate parameters: the number of grids and the grid interval determine the speed of grid trading.

 

Q8: How to make profit with Futures Grid?

First, predict the market direction within a large period. Use reliable technical indicators to track the general trend, predict the direction of the trend, and earn big profits.

Secondly, take advantage of Futures Grid automatic arbitrage to earn grid profits in volatile markets and offset the profit wear of fluctuating pullback market in trending market.

To sum up, use the method of trend tracking to predict the long and short direction, and then use the grid profit to offset the profit wear of pullback.

 

Q9: Can Trading Bot automatically stop loss or take profit?

Yes, you can turn on take profit and stop loss. KuCoin Trading Bot has such functions in its advanced settings interface.

Stop loss means that when the currency price triggers the stop loss price you set, it will help you sell all to stop loss. Taking profit is in the same logic. When the currency price rises to your take-profit price, it will help you sell all of it to make a profit.

 

Q10: How to set the parameters when using Trading Bot for the first time?

If you are new to using a Trading Bot, we have two tips to help you get started easily. One is AI parameters, which will provide the bot parameters based on the historical data of the coin.

Another way is to choose the AI Plus mode. As of now, this mode only supports Spot Grid Bot. It does not require you to set any parameters, however, the AI program automatically sets the parameters and trades according to the established strategy logic.

If you are an advanced trader, then you can use the custom mode, using your own cognition and of the market, and set the parameters by yourself.