Artificial intelligence and machine learning help trading bots constantly develop and evolve, but there’s still a long way to go to beat human instinct.
It’s unlikely a bot will ever be able to detect a catastrophic threat to the crypto world, or gauge the significance of emerging technologies. Also, it’s worth bearing in mind that, if everyone was to use the same strategy put forward by a trading bot, no one would have that all-important edge which results in profitable moments.
That said, some custom-made bots are being bit with the capability of scouring social media for news using keywords.
Although this could help flag up a crucial development to an investor, it would be dangerous for the bot to act on its own in case said post turns out to be “fake news” – or a rather over optimistic assertion from a rookie crypto startup.
As a result, some bots are trying to achieve the best of both worlds. Services like Cryptohopper enable investors to buy and sell automatically using professional indicators, the main form of technical analysis.
This bot also provides access to third-party technical analysts, who send out alerts about promising investments which the bot can act upon automatically on a user’s behalf.
This allows more room for the human touch that is required for fundamental analysis.
It could be argued that such a hybrid can give a much-needed edge in terms of quick transactions.