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Views: There are various methods of making money in cryptocurrencies: staking, lending, trading, algorithmic trading, and hodl.
Hodl is the result of a misspelling of the word hold, which has gained popularity as a meme in the cryptocurrency industry.
In general, hodl means investing. You buy a cryptocurrency for a long term, such as a few years, with the goal of selling it for a higher value in the future.
But what could go wrong?
Let's imagine that you bought ETH at 2000 per unit and started to hold it until better times.
On the price chart you can see how the price reached 4000 and even 4500, but after that the price went into correction and at the time of writing the ether costs 2800.
In fact, this means that you have lost the most profitable exit point of the trade. Even hodlers need to lock in profits periodically.
Many people make the mistake of making the timeframe rather than the price of the asset and profit as the goal in a hodl strategy.
You can set yourself the goal of selling Ether in six months. However, as in the example above, the asset may have the most favorable conditions for selling in 5 months, and on the 6th month it will go into correction.
The main principle of every trader is profit taking! Therefore, before entering a trade, you should decide for yourself what profit from the trade is the target profit.
So, how can bots help you if you are a straddler?
First of all, when you enter a position, even for a long term, it is important that the entry price is optimal.
It is often not so easy to do it by hand, and waiting for this “optimal price” may take a long time.
This is where bots will help first of all.
You can configure a bot in such a way that at the moment when an abnormal drawdown of an asset starts, the bot will buy a position at the optimal price.
Then you will not have to wait and search for the moment - the bot will do it for you!
Similarly with profit taking. You will not bite your elbows when you missed the opportunity to sell ether at 4000. You can initially set a target profit percentage of 100-500% and the bot will do all the work for you!
- Capture profits
- “Come in” at the optimal strait price
- Set your desired profit percentage before entering the trade
- Do not miss the moment
