Trading Tips with Mizar & Block Party Trading | How DCA Bots Work Part 2
What’s a DCA Bot ACTUALLY Doing? And How Can I Help Make it Better?
In our last article we took a look at the basic terms we need to understand DCA bots, a brief overview of how they work, and why the technology implemented by Mizar will help you get an advantage in the markets.
In this article let’s look a little more in-depth at what the DCA bots are actually doing on exchange and how we can optimize our bots to get the most out of them.
What Is My Bot Actually Doing?
When we first open a trade multiple things are happening all at once: The BO is either being set as a limit order or triggered as a market order right away, SO’s are placed as required and a TP is placed if trailing is not enabled. All of this happens in a split second!
Now our trade is live, but the bot doesn’t just stop working. The bot is constantly watching the price and, if you are using block shift safety orders, waiting for the signal to buy more.
If the prices go right to TP and the TP is a limit order, it will fill, cancel any remaining SO’s on the exchange, and the deal is done with profit recorded! If the TP has trailing then the bot will watch the price until a set deviation is reached. For example:
>If we have a TP of 2% with 0.5% trailing, then the bot would enter trailing mode when we are +2% over our entry price. It will then wait for the price to DROP 0.5% to close the deal.
>If the deal drops 0.5% immediately it will close for 1.5% profit
> If the deal raises another 1%, then drops 0.5%, it will close for 2.5% profit.
>if the deal raises another 5%, then drops 0.5%, it will close for 6.5% profit!
But what happens when we don’t go right to TP? Well if the price drops that’s where our SO’s come in.
Every SO we hit, whether it be from a block shift or a limit order SO, will cause the bot to recalculate a new TP based on the new averaged buy price. This calculation is again done far faster than any human could do manually. The bot will also place a new SO at a set deviation, and as long as you have available SO’s left — or it will wait for its next signaled SO.
All of this action taking place at once is really the key benefit of automated systems. It is impossible for a human being to match the speed and accuracy of an automated system when it comes to placing orders and making calculations on the fly.
This is also why even if you only have one deal open, you may have MULTIPLE orders open on the exchange, or sometimes NO orders open if you’re using a strategy based on market orders. This is normal and as long as it’s consistent between deals then there’s nothing to get worried about!
How Do I Optimise My Mizar Bots?
One of our favourite things about Mizar is that you really don’t have to do much work for the end consumer to get the best possible product. Because of this, the best way to optimize on Mizar is simple:
>RUN MORE STRATEGIES!
There are a ton of great strategies out there, and they work in different market conditions. So if you REALLY want to optimize your Mizar performance, do what any trader will recommend: DIVERSIFY!
And the best part about trying multiple strategies on Mizar is you’re only paying for the profit you make! So don’t be shy, get out there and get your bot fleet started today!
Join us again next week for more Trading Tips & register with MIZAR to automate your trading and get back your time.
Make sure to follow BPT’s Social Channels as well!
Twitter: https://twitter.com/blockpartytrade
Website: https://www.blockpartytrading.com
Telegram: https://t.me/BPTbotchat
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