Were closely watching the Crypto Currencies market if you can refer to it that, because of the fake data, fraud, and related problems. One thing stands apart – it isn’t really so unique of FX, commodities, futures, or stocks. Market dynamics are market dynamics. And since many readers of this fine site will already know – nearly all traders lose. There’s been analysis done for this, we all know how this ends. A few early investors make a bundle and thousands or millions even stay holding the bag. From one perspective, a bubble is similar to a ponzi scheme. In MLM, there are a few who get rich – the founders.
Unless you are the founder – how can you tell which Crypto is going to be the next Bitcoin? You really do not. You have no clue. You can look to Korea and do all of the research you need, in reality that there is no-one to see the future or a top analyst may be wrong sometimes.
Quant traders have the identical doctrine they all share – they’re smart enough to know how stupid they may be. They know their unique flaws and they post to a better power- that is certainly Artificial Intelligence.
Computing power is now so massive it is possible that now you may using their own house office create an intelligent software system that does well. Obviously, as with the laws of market dynamics, you can also create a robot which is worth exactly zero – a large pile of crap. When a quant makes an algorithm it’s either priceless or worthless. If it truely does work, he’s effectively developed a wealth creation machine. If this doesn’t happen work, there isn’t any value to anyone not even academics.
How do we know very well what method works, how to build a practical bot or purchase one? There are obvious conflicts of curiosity in those who sell bots. The internet may be covered with good marketeers, while profitable quants mostly keep their ways of themselves. Selling a product, and trading a robotic, are actually 2 different skills.
Crypto to date has shown the same as most markets: impossible to trade.
While many are kicking themselves because of buying and holding, I can tell you as a trader and I speak for most in the room that there’s absolutely no way I’d also have the patience to take a seat on the hugely profitable position for 3 years as the price goes parabolic.
That’s why quants develop and trade algorithms – picking entries and exits can be brain-destroying. There are dangers and risks with robots too of course, however they are of the different nature.
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