Coinbase is among the most established and well-known bitcoin exchanges in the west. It is an excellent platform since it has a reliable spot market and a huge selection of exciting financial products. A Coinbase trading bot is a tool that helps many traders on this platform to achieve steady results without having any prior exposure to the cryptocurrency market.
While not the best choice for people interested in derivatives, it is still a top-rated destination for retail traders focused on buying and selling coins without relying on leverage. There are many ways to ensure that you are diversifying correctly and planning for the long term, but a lot of retail traders often overlook automation when building their trading systems.
What is an automated crypto trading app?
A bot is a web application executed in the cloud by an automation service provider. While client-sided apps also exist and can be used to a certain degree of success, the vast majority of modern retail traders prefer using third-party providers that run trading scripts on powerful machines directly connected to exchanges.
This approach reduces time to waste, makes it easier for traders to quickly react to market shifts, and delivers consistent performance across any period. Humans often lack the necessary dedication, stamina, and collectedness to trade at the same level as robots can.
Let’s talk about Coinbase Pro automated trading. This exchange has an API that allows third-party vendors to connect to the exchange directly. Any automation provider that can utilize the API functionality of Coinbase Pro can place orders instantly, frequently outperforming human traders and automation solutions that do not connect to the exchange via API.
To work, a Coinbase API trading bot requires three key components:
TradingView. This platform is widely used as the main source of market data and signals for most automation solutions. You can write your strategies using Pine Editor on the TV website or use something designed by prolific community members.
WunderTrading or a similar automation vendor. Bot providers receive inputs from TradingView and analyze them. Your script will send orders to exchanges according to the instructions that you write for them.
Coinbase Pro account. You will need an appropriate account with sufficient funds on Coinbase. Your bots will place orders on your behalf and the exchange will execute them as quickly as possible to reduce any idle time.
What is the best trading bot for Coinbase Pro?
The trading automation market is oversaturated with the offer and finding good products is quite a challenge for the vast majority of people who want to engage with the crypto market. Coinbase Pro is a great destination for the vast majority of retail traders and there are some really good automation providers directly integrated with this popular exchange.
We want to talk about some of the best companies offering automation platforms:
3Commas is a specialized automation vendor that offers a wide range of different social trading products. When it comes to copy trading and other social features, this provider is certainly among industry leaders. Their paid plans are reasonably priced and have some interesting features for “whales”.
CryptoHopper is another name frequently mentioned on various forums and ratings. It is a good choice for people interested in complex scriptwriting and flexible products. There is a free plan that allows you to have up to 20 open positions on a single exchange.
WunderTrading offers a rich selection of automation solutions including preset products like GRID and DCA bots. The flexible pricing system and a free plan allow users to test up to five different bots without paying a dime. It is seamlessly integrated with Coinbase Pro meaning that you can start trading on this exchange using WunderTrading bots right from the get-go.
We strongly advise all retail traders to employ Coinbase trading bot for free. A free plan provides a way in to the great world of trading automation on numerous platforms, including WunderTrading. On TradingView, you can back-test your approach using past market data to generate wild hypotheses that can be tested right away.
At the same time, you will protect your wallet from unnecessary expenses until the moment when you decide that automation is worth your attention and money.
Should you use a Coinbase trade bot?
There is a good argument in favor of using automated trading systems on any CEX platform. This financial market is extremely competitive and volatile. It is hard to pinpoint a good moment to enter the market when doing everything manually. You are also subjected to stress and doubt meaning that you hesitate and waste time instead of acting.
All your positions can be closed manually when necessary. Additionally, risks are diminished by stop-loss orders. It is a relatively safe way to invest in the crypto market. On Coinbase, automated trading is a great way to outdo the market and make money consistently while not dedicating an awful lot of time to learning the intricacies of technical analysis.
Forums are packed with user-rated trading strategies that show incredible performance and can be integrated into your investment plan seamlessly.
The main takeaway
The efficiency of a Coinbase trade bot is hard to measure. Each case produces unique results due to the fact that most vital decisions are made by users. Bots only execute actions provided to them by human-written instructions.
While you may believe that you can outperform a machine by making some smart choices, the reality is that you will make the same smart decisions but faster. A trading bot is like a boost to your brain. It makes everything faster and more reliable.
At the same time, a retail trader may opt to use preset solutions like GRID and DCA to invest with low risks or accumulate assets respectively. Deciding whether to include a Coinbase automated trading bot in your financial activities is something that you alone can do!