🗿 How to Trade Using AI

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GM. Happy Tuesday. It’s December, which is crazy considering it was August 3 weeks ago. All good things must come to an end, unfortunately. That includes clean looking ChatGPT, as OpenAI is looking at adding ads. 

In better news, today we’re teaching you how to supercharge your crypto gains with AI and trading bots.

Without Further Ado. ☕ *knuckle cracks* ☕ Let’s get into it.

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How to Utilize AI for Crypto Trading

Okay, the markets are up. It’s a bull market. But you’re not generationally wealthy. Why not? 

One of the biggest roadblocks is time. No one really has time to be in the depths of crypto twitter and telegram looking for the next $moodeng. Most of the stories you read about someone who “got lucky” and turned $100 into $300k fail to mention that this trader also spends 18 hours a day locked into twitter AND has probably lost 100 times before that win. 

So how can you compete with these guys? One answer is utilizing AI and trading bots. 

If you’re reading this, you probably have at least heard about trading bots. But what are they really doing? How can you set one up? Are they really making people profits?

Today we’ll give you the intro class so you can get started in the world of trading bots. 

What are AI Trading Bots?

“A crypto trading bot is a computer program that uses artificial intelligence and advanced algorithms to automate the buying and selling of cryptocurrencies. Acting as a virtual assistant, these bots analyze vast amounts of market data, identify patterns, and execute trades in the crypto market accordingly. They can simplify the trading process and provide a competitive edge by leveraging real-time and historical market data.”

Most importantly, these bots operate 24/7 aiming to execute preset strategies. This gives you time to have a real life, but still reap some benefits of a professional strategy. Second most importantly, bots have no emotions (yet). Remember that time you panic sold (inset coin name) and lost out on a 100x gain? Yeah, bots don’t get panicked. 

Here are some key ways bots and AI tools optimize trading:

• Hype Detection – identify when a memecoin is gaining traction to enter positions early

• Volatility Arbitrage – capitalize on the sharp price fluctuations typical of memecoins.

• Momentum Trading – use AI to detect upward price momentum and execute trades at critical entry and exit points.

Of course, there are many different types of bots executing even more types of strategies. But this is a 101 class, so we’re going to keep it simple. (Here’s a list of some of the general options if you’re curious)

Okay, sounds cool, how do I get started?

First, you need to decide what your general strategy and risk tolerance is going to be. This is important to do before you get started, and even more important to stick to. Use your initial goal as your north star. If things start going well, it’s easy to get distracted by shiny objects and you’ll end up losing it all. 

Beginners should probably be using a trusted, reviewed platform to get started. It may cost you a subscription fee, but that’s better than setting up a bot that drains your whole account in 3 hours. 

Picking the right tool

It’s important to pick a tool that matches your goals. Do you want to just trade BTC and ETH on major exchanges? That’s going to require different features and tooling than if you want to trade memecoins with a $100k market cap. 

Ironically, the best way to search for the tool that’s best for you probably is through ChatGPT. If you input features that are important to you and your trading goals, it will give you a shortlist of the best tools. 

Here are some platforms that offer pre-built and customizable bots for automated trading:

Pionex

Features: Built-in trading bots (e.g., Grid Bot, DCA Bot, Arbitrage Bot), low trading fees.

Best For: Beginners and intermediate traders.

Highlights: User-friendly interface, no need for external APIs.

3Commas

Features: Smart trading bots, portfolio management, grid trading, and DCA bots.

Best For: Traders looking for comprehensive automation with advanced features.

Highlights: Compatible with multiple exchanges like Binance, Coinbase, and Kraken.

CryptoHopper

Features: Cloud-based, customizable bots, backtesting, and social trading.

Best For: Intermediate to advanced traders.

Highlights: AI-driven signals and marketplace for pre-configured strategies.

Maybe bots aren’t for me, but I still want to use AI

Let’s say you don’t want to actually hand anything over to a bot, but just supercharge your trading with some AI insight, you can do that too. 

Here are a couple of platforms integrating advanced AI algorithms for trading decisions.

Stoic by Cindicator

Features: AI-powered trading with low maintenance.

Best For: Passive investors.

Highlights: Fully automated portfolio management and hedging.

Kryll

Features: Drag-and-drop strategy builder, backtesting, and live simulation.

Best For: Traders who want to design custom strategies without coding.

Highlights: AI-driven indicators and an intuitive interface.

Creating a custom bot with ChatGPT

If you’re already familiar with everything above, thank you for sticking with us. 

Trading bots are an endless topic, and the final frontier is creating your own bot. We know a good amount of our readers aren’t experienced coders, so why not have the robots do it for us? 

It is possible to create your own bot with ChatGPT. Below is a twitter thread explaining one way to do it. The guy who wrote it is selling his channel, so tread carefully with everything he says. BUT, the mechanics of setting up the bot is sound. If you’re feeling adventurous, give it a go. 

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DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell assets or make financial decisions. Please be careful and do your own research.