Cryptocurrencies can experience sudden and sharp uptrends, and the Relative Strength Index (RSI) is a valuable tool for finding them. Coinrule's Trend Following bot can automate your trades to help you buy the coins in a solid uptrend as their price can increase further. The RSI is a technical indicator that measures the magnitude of a currency's price movements.
High values indicate that the price is rising rapidly. Lower values, on the contrary, signal that the price is falling. In theory, an RSI above 70 means that the price of the coin has already increased significantly; so it might be a good time to sell. On the other hand, the RSI of cryptocurrencies can remain at high values for an extended period. Essentially, where Waves RSI stays above 60 and usually above 70 for almost a month, buying and selling on the rise can provide excellent opportunities.
In this article, we will discuss:
What is Coinrule?
Coinrule is a cryptocurrency trading tool that has implemented smart trading bots, making it easy to automate cryptocurrency trading strategies.
The platform has numerous comprehensive tactics that you can choose from. And if you are unsure about trading methods, you have the chance to select from over 180 pre-existing trading templates.
However, the number of rules that can be used, the number of exchanges someone can connect to, the trading volume and available trading models depend on your account plan.
Coinrule has 4 account levels: beginner (free), amateur, trader and professional. And as you might already suspect, the more advanced the account plan, the more features it will include.
Avoid Bombs and Dumps
Coinrule's simple If-This-Then-That approach makes it easy to create trend-following bots to buy coins that are in solid uptrends, avoiding short-term bombs and dumps where the risk of buying the top is too high .
With the help of the rule, the bot would buy any currency with the RSI indicator more significant than 70 in a 4 hour time frame using the wallet USDT of the portfolio. The 4-hour timeframe was chosen as having the greatest success and profitability when tested. Using “any currency” will lead to a more significant number of currencies being traded. However, you can also choose specific cryptocurrencies from the available list. The bot will scan the market and buy any currency that meets this condition.
Closing your negotiations
Let's say you choose a profitable rule with a 6% price increase from the coin price. The rule stop loss will be if the RSI value drops below 55, indicating a possible weakening of the trend.
Essentially, this rule will automatically buy any currency when the RSI is above 70 and sell the currency if the price increases by 6% from the entry price.
Let's look at an example on the Ethereum daily chart to examine how this rule would work:
When the RSI rises above 70, the rule's buy conditions will be met and the rule will enter ETH at a price of around $3175. The chart displays a 6% increase before the RSI drops below 55, which is the condition of sale. Thus, the rule would have exited the position around $3.366 for a 6% profit return on the trade. You can take advantage of these opportunities on Ethereum today by automating your trades with Coinrule's Ethereum trading bots.
Using Coinrule's RSI Robots
Conirule indicators such as the RSI and other strategies can help identify entry opportunities with high growth probability. The insights in this tool will help you build a stronger portfolio and make the best possible investment choices over the long term.
The most essential feature of RSI bots is that they will make things simpler without requiring 24/XNUMX human supervision but only periodic inspections. In times of market downtrend, the RSI will rarely be at high values, so the strategy will wait for more convenient market conditions before opening new trades.
Regarding cryptocurrency trading, bots are your most profitable choice to make wiser decisions and avoid costly mistakes. However, in the end, it all comes down to one's feelings about what is best for their portfolio.
