Volatility and Automated Cryptocurrency Trading

Many of us have taken some initiative to trade cryptocurrencies to make extra income or just because it is a hype. The cryptocurrency is a speculative market, and it has been quite volatile over the last years. Now that there are even more altcoins, it becomes more difficult to understand the market or to make rational decisions for a trade. One of the studies that I wanted to do was to delve into some historic data of the current cryptocurrencies and analyze their trends by quantifying volatility. Every trade is based on a strategy, and each strategy is motivated by historic data. There are many digital trading strategies in the market that are often used in cryptocurrencies automated trading, I will briefly explain the following two since they are mostly used in automated trading: <ol> <li>Spot trading: referred to as the cash market because payments are instantly processed. In other words, the contract between a buyer and a seller will be fulfilled on the spot at the best available price with a requested quantity.</li> <li>Futures trading: happens when a contract with another party is agreed on an asset’s price for some date/time in the future. This contract is speculated on a specific day, i.e., the transaction is not immediate. The requested trade will only be fulfilled at a specific set price and date that have been agreed upon in the contract. Futures trading is usually used with leverage. It is a high-risk/high-reward trading strategy that experienced investors use with the aim of increasing their returns, where if your speculation is fulfilled the gains can be very high, but also quite risky.</li> </ol> <a href="https://medium.com/@e.a.t.ibrahim/volatility-and-automated-cryptocurrency-trading-2837924f53e2">Visit Now</a>