It’s difficult to find high-probability trades in a crypto bear market. It’s even more difficult when macroeconomic factors are brought into play. Moreover, bear markets don’t represent a specific trend. Markets can consolidate, run sideways, or enter a recovery phase followed by a quick reversal.
So does this mean you should stop trading during bear markets? Not at all!
There are always opportunities to make a profit. To do this, you must watch the markets closely, stick to your price ranges, and manage risk. You also need to keep an open mind because if you always follow a bearish trading strategy, you could get completely sidelined or miss the bottom of a token’s price.
This is a lot to take in for someone who is just becoming a trader. But don’t worry. There’s a solution! Crypto trading bots can help you. With them, you can use accurate trading signals to grow your capital in a bear market continuously.
But don’t trading bots come with a lot of risks? Yes, most of them are unreliable. You need to check the bot’s features and signal providers carefully. In this article, we’ll take a closer look at one of the most trusted trading bot platforms, 3Commas, and show you how to use it to maximize your profits in a bear market.
What Is 3Commas?
3Commas is an automated trading bot platform for cryptocurrency traders. It aims to make crypto markets accessible and easy to navigate. 3Commas supports more than 17 major exchanges and allows you to manage multiple accounts from a single trading terminal.
3Commas also offers pre-built trading bots that can be freely customized and used for multiple trading pairs. There is a marketplace where experienced traders share trading signals, which you can easily subscribe to and use to make profits. If you want to automate your trading strategy, you can create custom trading signals and apply them to a bot.
Read more: what is 3Commas.
Types of Crypto Trading Bots on 3Commas
3Commas has built a large following in the crypto community by introducing five simple trading bot strategies. Anyone with a minimum of capital can use these bots. While some bots appeal to long-term investors, others attract crypto traders in spot and derivatives markets. So check out all five crypto bots below to find out which one is suitable for your trading strategy.
If you are in trading for the long term, it’s advisable to follow the dollar cost-averaging approach. The DCA (Dollar Cost Averaging) bot allows you to break your investment into smaller chunks and buy the asset at different price points over time. This will increase the average price of your position and ROI (Return on Investments) when market conditions improve. Even if you’re an experienced trader, the DCA bots can help you take profits and add to them when the market drops.
On the 3Commas platform, you can create a DCA bot strategy and settings or choose a preset bot. If you decide to use a preset bot, you need to check the minimum capital required and the bot’s current performance reviews.
Bear markets are frustrating because you can’t see a trend in the foreseeable future. So you risk getting chopped in a tight trading range. But not with the Grid trading bot on 3Commas. You can choose a range of sell and buy prices to make profitable trades even in a sideways market.
When the price reaches the upper end of the range, the bot executes sell orders and vice versa. Grid bot doesn’t leave money on the table because it adds the buy/sell orders when the price reaches either side of the range.
However, there is one risk you should be aware of with a grid bot. If market movements impact the price range of your grid, you’ll either lose a lot of your capital or miss out on additional profits.
The simplest bot on the 3Commas platform is the HODL bot. It’s similar to the DCA bot, but there are no custom conditions or strategies. It’s simply a buy-and-forget function that relies on repetition without worrying about price fluctuations.
You can also use the HODL bot for multiple cryptocurrencies simultaneously. You can customize the bot’s settings to determine how much money you want to use for each order and when you want to execute the trade.
Options bot is one of the most attractive financial instruments every new trader wants to use. This is because the Options bot offers traders high leverage with small amounts of money. At the same time, Options carry the highest risk compared to other derivative markets like futures.
Therefore, risk management and hedging are crucial when trading options. To help you navigate this financial market with high barriers to entry, 3Commas has developed the Options bot that automates your short and long-straddle strategies. If you adjust the contract parameters, you can also use the same bot for futures trading.
This pre-programmed bot is suitable for beginners. It navigates the market pairs around the clock to bring the trader a profit. Smart bot sells the coins when the market picks up after the decline, and when the market is down, it shows some losses, but less than the market’s downward movement.
It’s easy to use and allows trading crypto portfolios with multiple pairs. 3Commas team is constantly improving the algorithm, making it a universal go-to for any crypto trader.
Best 3Commas Signals in 2023
If you find it hard to manage your trades and make profits, you can adopt the strategies of experienced traders who know technical analysis and always end up on the right side of the trade.
3Commas has a marketplace where you can find social trading signals and apply them to your crypto bots. You can either opt for free or paid subscriptions. The most important thing here is the hit rate, which indicates what percentage of trades result in profits.
So, always check the bot’s historical performance before using it. To simplify the process and help you develop an automated trading system, we have listed some of the best 3Commas crypto trading signals that you can use in 2023.
The Better Traders, or TBT, is a global crypto trading education company with over 25,000 students. They have created TBT signals on 3Commas to help inexperienced traders better navigate spot markets. These signals are supported on major crypto exchanges like Binance and Coinbase.
The bots you use to generate automated trading signals can be utilized for all trading pairs available on the exchange. But you must manually change the settings using the given template to change the trading pair and adjust other parameters like safety order size and max active deals. If you can’t figure it out, you can even check out their courses on bot trading.
Crypto Quality Signals, or CQS, is a free signal provider on 3Commas that’s been active since 2018. CQS also provides signals on major exchanges like Binance, OKEX, and KuCoin. The main trading strategies that generate CQS signals involve price and volume detection based on selected technical indicators.
You can also follow the CQS bot signals on Twitter to receive automatic calls and execute trades efficiently, no matter what device you use to trade. Apart from regular trading signals, CQS also offers scalping signals for traders who want to trade on low time frames. If you’re interested in day trading and swing trading, you can opt for CQS premium packages.
HIRN Crypto signals group is one of the most followed signal providers on 3Commas, with over 30,000 traders. The trust in HIRN Signals comes mainly from the years of experience of the team and the quality of the daily free crypto signals.
HIRN is also one of the few trading signals providers on 3Commas that supports spot and futures trading. HIRN signals can be used on Binance, Huobi, OKX, and Bittrex.
If you’re looking for a complete package of HIRN signals, you can subscribe to the Premium or VIP plan on a monthly basis. Prices range from $15 to $30 per month.
BlockParty signal providers can be a perfect trading partner for new traders. With more than 15,000 traders using BlockParty signals, it’s safe to say that BlockParty membership is worth it. For $29 per month, you can use signals with a win rate of over 70% and with full automation. At the same time, you get daily analysis of the markets with curated news feeds.
If you want a more advanced trading system, you can choose the BlockParty Labs membership for $49 per month. You’ll then get detailed trading guides on various technical indicators and access to an exclusive Telegram community. But that’s not what’s special about this membership. With BlockParty Labs, you can submit custom requests for trading strategies and use them with the help of trading bots.
BlockParty also has a premium plan that offers trading signals and indicator-based strategies. It’ll cost you $69 per month.
BlockAlgo is a free signal provider for the spot and futures markets, powered by Block Research. It provides trading signals for trading pairs available on exchanges such as Binance, KuCoin, OKX, and Coinbase. The minimum capital requirement to get good results with these signals is $1000-$2000. The signals are for major cryptocurrencies, including XRP, MATIC, THETA, SOL, ADA, and AVAX.
If you need premium signals, you can head to blockresearch.ai and select a monthly plan. You can directly access Block Research’s proprietary trading engine called Tyson and apply all the trading signals. Even in the bad year of 2022, Tyson could generate 320% ROI.
The paid crypto signals vary depending on the portfolio size and VIP support. For the Starter package, there is no VIP support and the portfolio size is capped at $5,000. For the Advanced and Pro packages, you get VIP support, and a portfolio can go over $20,000.
How To Automate Your Trading Strategies On 3Commas
Social trading is an innovative concept to encourage people to participate in financial markets. But it’s not the most effective way. The main reason is that you cannot follow signals based on past performance. If a trader has done well in a bull cycle, it doesn’t mean their signals would work in a bear cycle.
So, it’s always better to learn cryptocurrency trading and develop your own strategy. Once you have applied the strategy in different market conditions, you can safely apply your trading indicators and other parameters to create a bot. On 3Commas, you can directly embed your TradingView strategy and automate it with custom signals. Below you’ll find a step-by-step guide that you can replicate with your trading strategies:
Step 1: Sign up on 3Commas
If you don’t have a 3Commas account, create one here. Once you register successfully, you need to connect your exchange account to 3Commas using the API keys.
If you’ve never created API keys before, go to API management in your exchange. The “Create API” option will prompt you to enter a name. After you name your API key, you’ll need to complete the 2FA process and edit certain restrictions. The latter is important because you don’t want anyone else accessing your money. You’ll see a pop-up window similar to the one shown below:
After editing the restriction, you should save it and copy the API keys. This will include a Secret key that you should copy immediately. Once both keys are copied, go to your 3Commas account. Click on “Portfolio,” and you’ll see the “Connect Exchange” button. Select your preferred exchange and enter both API and Secret keys.
Step 2: Create a trading bot
To create a trading bot, click “DCA Bot” on the left-hand side of the 3Commas dashboard. Now, you need to adjust certain parameters, such as order size, order type, and target profit percentage.
Out of all parameters, the one you should most remember is the deal start condition. This will be where you select your custom signal from TradingView.
If you want to limit the bot from using too much capital, you can put the safety order size to zero. You can also add a stop-loss order to close the deal and stop the bot. The ideal SL range is 2-5%. After all the settings are made, you can save the bot. You can see it under the “My Bots” tab.
Step 3: Select indicators to create a trading strategy
Technical analysis is key when setting up a strategy for a crypto trading bot. You must select an indicator or a combination of indicators that give you more profitable trades. In this example, we’ll select a simple Money Flow Index (MFI) indicator that gives us a picture of money flow based on volume and price. Also, we’re selecting the ETH/USDT chart to use the MFI indicator. You can check the chart with the indicator applied below:
Step 4: Add deal start and close conditions on TradingView
In this step, you’ll create alerts on TradingView that will be sent to your 3Commas bot. To create new alerts, click on the clock-like symbol on the top-right of your trading chart. You will see a pop-up box like the one given below:
In this alert box, you need to change the condition to “MFI” and choose “Crossing down.” When the MFI signal goes below a certain value, say 20, the bot will get a signal that it’s getting oversold and it’s time to go long.
Similarly, you must choose “Crossing up” when the MFI signal exceeds the given range and indicates the bot to market-sell. After adjusting the settings, you must paste the 3Commas message for the deal to start and close. So you’ll be creating two alerts.
Step 5: Backtest and run the bot
Before you run the bot, you can do one final backtest for confirmation. You can see how the bot is responding to the MFI signals. If it’s giving good results based on the time frame you entered, you can then start the bot.
But, you can always stop the bot in order to avoid losses if you see any major drawdowns in the crypto market. This is mainly because you don’t want to give back your profits during periods of high volatility leading to your trading bot executing at the wrong time.
Things You Should Know Before You Start Bot Trading
So far, we have covered some of the best trading signals you can use to copy trade and explained how you could automate your TradingView strategy. Now it’s time to understand what risks you’re carrying by using crypto trading platforms like 3Commas.
No such thing as guaranteed returns
If anyone on the Internet is promising guaranteed returns using trading bots, you should run far away in the opposite direction. No matter how good a strategy is, you can never 100% trust a bot to make perfect decisions.
So don’t fall for anyone claiming to make you a certain amount of money quickly. It is more likely they are trying to sell you a course or subscription plan to their paid trading group.
API keys can be leaked
Securing your API keys is one of the most important things when dealing with trading bots. Although you might have disabled the withdrawal option, hackers can still access your funds and perform unauthorized trades. This recently happened with 3Commas users, who lost upwards of $14.8 million to phishing attacks.
To avoid being the next victim, you can regularly see the progress of your bot and set alerts to your mobile when unauthorized trades are executed. If you are not going to use your trading bot, you must always delete the API keys to exchange accounts.
Low market cap coins are unpredictable
Low market cap coins have less liquidity and tend to move more violently than top cryptocurrencies. For example, you have a DCA bot set on an altcoin with a 100 million market cap. Now the market has gone down drastically, majorly affecting the prices of altcoins. So instead of exiting the trade completely, your bot will keep placing new buy orders. You will be sitting on major losses if this doesn’t recover quickly.
So, you are taking on more risk, applying your bot to lesser-known coins that don’t drive significant volumes on exchanges. That’s why it’s recommended to stick to major altcoins and top-10 cryptocurrencies to reduce risk and stay profitable.
Signals from a marketplace cannot always be trusted
You should always be skeptical when someone offers crypto signals. If these so-called experts figured out the best strategy, they wouldn’t sell you courses. So always check the track record of the signals before you create a bot.
If you subscribe to a paid signals group, you should ask for detailed technical and on-chain analytics. A daily news feed to trade breakdowns should also be a feature of a paid trading signal group.
Final Thoughts: Is 3Commas Really Worth it?
3Commas is a cloud-based crypto bot trading platform that aims to democratize access to crypto markets. It has all the features you need, with various trading bots that can be used in both spot and derivatives markets. Further, 3Commas allows you to create custom signals of your strategies to feed a crypto bot. So, as a platform, 3Commas is among the best crypto trading bots.
What you can’t forget, though, are the risks. Trading bots aren’t so reliable that you can bet large amounts of capital. There is also a risk that your account may be hacked. In this case, even your portfolio, which is spread across several exchanges, can be vulnerable to attacks. That’s why you need to double-check everything if you want to start trading with bots.