Utilizing 2 Bitcoin RSI Bots to Limit Risk in a Sideways Market
The bitcoin trading strategy we will be explaining today is a 2 bot bitcoin RSI setup. The reason why we are setting up two different bots to run 2 different bitcoin RSI crypto trading strategies is because we want to limit risk and to find out which set works better for the market conditions. We basically don’t want to put all of our eggs in 1 basket. This strategy is perfect for utilizing the trade channel bitcoin trading strategy, where you set up static roof in at the highest point in the trade channel and a static drop loss for the lowest point. This is meant for a sideways market with small fluctuations in price.
Bitcoin RSI Bot 1 – Shorter RSI Time Interval
So the reasoning behind Bot 1 is we want to start off with a short time interval. First of all, we want 10 hours worth of data, so that this is as accurate as possible. So, we will choose a time period of 5 minutes, which means that we need a bitcoin RSI data length of 120. The math behind this is 10 hours = 600 minutes/5 minutes = 120 data lengths or candles. We will leave the RSI values the same, as they work quite well. We do not need any safeties and the only insurance we want to use (optional) is the “Cancel Order after 1 minute” insurance.
Bitcoin RSI Bot 2 – Longer RSI Time Interval
So now we want to set up a separate trade bot for a longer time period RSI. For this, we will use the 15 minute time interval. We will also want to use 10 hours of data, so we will use a bitcoin RSI data length of 40. The math behind this is 10 hours = 600 minutes/15 minutes = 40 data lengths or candles. As with Bot 1, we will then want to use the “cancel order after 1 minute” insurance, so that we make sure our trade signals are executed in a timely fashion.
This 2 bot bitcoin RSI strategy is great for novice traders to get a feel for which trading strategy is best for the current market conditions. It is always important that when trading bitcoin, that we do not trade all of ones money with a single trading strategy, but if one wants to, they should use the trade channel set up in conjunction with this 2 bot set up, so that there is a bit of protection from sudden bitcoin market drops and rises.
We know that RSI is a great indicator for small price fluctuations and we understand that there is a risk of it prematurely buying in a down trend and selling in an uptrend. Thats why it is important to utilize the trade channel method to protect the bitcoin RSI method from getting out of position. Best of luck to your trades and utilize this strategy whenever we are in a sideways market! Remember, as a trader, we should do everything we can to improve our trades, but stay away from some of that technical analysis voodoo chart stuff.