How to make money on AAVE cryptocurrency with the help of a trading bot

Cryptocurrencies are a world of opportunity, but for beginners, it can seem confusing. How not to miss a profitable moment? How do you avoid making mistakes due to emotions? The answer is automation. In this article, we will break down the trading bot for the AAVE coin from the Veles platform. You will learn how it works, what its settings mean and how to start trading, even if you are just getting acquainted with cryptocurrencies. And also - how to customize this strategy for yourself!

Why is AAVE an interesting coin to trade?

AAVE is the cryptocurrency of the DeFi (decentralized finance) project of the same name. It runs on the Ethereum blockchain and allows people to lend or borrow cryptocurrency without banks. It is a popular asset with high volatility - the price can rise or fall quickly, which makes AAVE attractive for trading.

Facts about AAVE:

• Price: $147.26.
• Market capitalization: $2,222,289,666.82.
• Trading volume: $116,551,467.85.

AAVE's volatility is both a plus and a minus: you can capitalize on price spikes, but it's important to be careful.

What does this bot do?

This bot is your automated assistant for AAVE trading. It is designed for markets with frequent price fluctuations - no matter if the price is rising or falling. The bot uses popular indicators (Bollinger Bands and RSI) to find moments to buy and sell.

Key features:

• Coin: AAVE.
• Frequency of trades: the bot enters the market frequently, reacting to signals from 1, 5 and 15 minute time frames.
• Order Grid: allocates your money into 5 parts, at 30% of the net price move, to reduce risk.
• Market: works with moderate volatility, catches small movements.

Simply put: the bot buys AAVE when the price is low and sells when it rises, doing it automatically and without emotion.

How does the bot make decisions? Taking apart the indicators

The bot uses two tools: Bollinger Bands to enter a trade and RSI to exit. Let's analyze them in order.

Bollinger Bands: where to buy and sell?

Bollinger Bands are like a "corridor" for the price on the chart. It consists of three lines:

• The middle line - shows the average price.
• The upper and lower bands are the boundaries where the price goes when it is rising or falling.

How it works:

• If the price touches the lower band - it is low, you can buy.
• If the price is near the upper band - it is high, you can sell.

The bot looks at these signals on three timeframes at once (1, 5 and 15 minutes). Why? In order not to make a mistake:

• 1 minute - catches quick jumps.
• 5 minutes - removes "noise" (random movements).
• 15 minutes - confirms the general trend.

In the market:

• When rising: the price often "breaks" the upper band, but then returns.
• When falling: the price falls to the lower band, which can be a buy signal.

Three timeframes make entry more precise - the bot waits until all signals coincide.

RSI: when to take profits?

RSI (Relative Strength Index) is a "thermometer" of the market. It measures how "overheated" or "cooled" the AAVE is on a scale from 0 to 100.

How it works:

• RSI below 30 - the coin is "oversold", the price is too low, growth is possible.
• RSI above 70 - the coin is "overbought", the price is high, a decline is possible.

The bot uses RSI on the 1-minute timeframe to exit: if RSI is above 75, it sells AAVE, locking in profits.

Fixing:

• When rising: the RSI rises, showing that the market is “overheating”.
• When falling: the RSI falls, signaling a possible reversal.

Why is a combination important? One indicator can deceive - for example, price is near the lower band, but the market continues to fall. By looking at three timeframes of Bollinger Bands and RSI together, the bot reduces the chance of error. It's like triple checking before acting.

Risks and how to control them

Trading with a bot is not a magic "make money" button. Here's what's important to know:

1. Free funds:
   • The bot is set up for a deposit of 50 USDT with x3 leverage (total 150 USDT in the case). 
   • Leave another 50-100 USDT in the balance to avoid liquidation (losing all your money in a sudden drop).
2. Leverage x3:
   • Leverage increases profits, but it also increases losses. If the price falls by 33%, the position will close at a minus. Without leverage, the risk is lower, but so is the return.
3. Stop Loss:
   • The bot does not have it. If you add it, place it carefully - too close and the trade will close early; too far away and you will have more risk.
4. Moderation:
   • Don't put all your money on one bot. Fracture your capital to test strategies safely.

Recommendation: start small - 50 USDT is enough to understand how everything works.

How to start trading?

1. Register on Veles.
2. Fund your balance (from 50 USDT).
3. Find a bot at the link: https://veles.finance/cabinet/bot/DGjwX.

Run it with basic settings and watch the results.

Bonus: new users get $5 on commissions for the test! This is real money that will help you get started without investing.

How to customize your strategy

This bot is a great base to start from, but what if you want to trade other coins or improve your strategy? Here's a step-by-step plan:

1. Test your strategy with backtests

• On Veles, you can run up to 10 free backtests per day - that's enough to test an idea.
• Want more? A $25/month subscription gives you unlimited backtests and access to advanced analytics.

2. Assess the volatility of the coin

• Highly volatile assets (SOL, DOGE, AVAX) are ideal for a 30% grid.
• Less volatile ones (BTC, ETH) may perform better with a 15-20% grid.

3. Customize timeframes to suit your style

• For scalping (quick trades) you can consider 1m and 5m.
• For medium-term trading, you can add 30m or 1h.

4. Check the response to indicators

Some coins "listen" better to RSI, others to MACD or Stochastic.

Recommendation: start with basic settings (Bollinger Bands + RSI) and then experiment.

Other indicators for the strategy

Filters for starting the bot allow you to enter trades according to specified conditions, increasing the accuracy of the strategy.

More details on these tools in our Wiki with guides and examples.

Where to start experimenting?

1. Copy the settings of this bot.
2. Replace AAVE with another coin.
3. Run a backtest (up to 10 per day - free of charge).
4. Analyze the results and change the settings.

Important:

• Don't change everything at once - take one step at a time.
• If backtests show profit, try it on a small deposit in real trading.

With 10 free backtests a day, you'll find your ideal settings. And a $25 subscription will open up complete freedom to experiment.

Your first step into automation

This bot on AAVE is an easy way to try cryptocurrency trading. It uses easy-to-understand indicators and takes the chore off your plate. And with our recommendations, you'll be able to customize it for yourself and other coins. Success depends on how you manage risk and study the market.

Ready? Sign up for Veles, get $5 to test and get the bot up and running. Or try the backtest on another coin and see for yourself how profitable the strategy is!