Grid bot is a trading bot that executes the grid trading strategy in cryptocurrency spot and margin trading. It automates the process of buying and selling cryptocurrencies at predetermined levels, aimed at benefiting from price swings and achieving consistent profits.

Grid trading is a strategy used in both spot and margin trading of cryptocurrencies. It involves setting up a grid of buy and sell orders at predetermined levels above and below the current market price, enabling traders to capitalize on price fluctuations. This strategy supports neutral, short, and long positions, allowing traders to adapt their approach based on their market expectations—whether they anticipate the market to rise, fall, or remain stable.

When deciding the best timing for using a grid bot, it's essential to consider your expectations for market movement. The grid trading strategy is versatile, allowing you to potentially profit in any market condition—whether the market is trending up, trending down, or staying relatively flat. Depending on your market outlook, you can choose from the following approaches:

Learn more about the difference between short, long, and neutral trading.

Once you have signed up and passed identity verification on XREX, you'll be faced with two options for how you would like to proceed with creating your first Grid bot: Smart bot or manual settings. The Smart bot recommends parameters based on 21 days of backtesting, while manual settings allow you to customize various trading options such as grid mode, short/long/neutral strategies, and other details to suit your preferences. For more experienced users, XREX also offers advanced settings for further customization. We encourage you to learn more about the differences between the Smart bot and manual settings or check out our step-by-step guide on how to get started with creating your first Grid bot on XREX crypto-fiat exchange.

User A invested $1,000 in the BTC/USDT trading pair using a Grid bot with a Short strategy on XREX. They set their upper and lower price ranges and configured the number of grids. To manage their risk, they also set up close triggers. The bot monitored the market and automatically placed sell and buy orders at the predefined levels. After a week of price fluctuations, the bot executed multiple trades, resulting in a 5% profit. Satisfied with the outcome, User A decided to close the bot and claim their profits.

User B invested $1,000 in the BTC/USDT trading pair using a Grid bot with a Long strategy on XREX. They set their upper and lower price ranges and configured the number of grids to use. Confident in the market, they opted not to set close triggers. However, after a few days, the price of BTC/USDT dropped significantly. The bot continued buying more BTC as the price fell, accumulating base assets. Since the price remained below the lower limit, unrealized losses began to build up. Worried about the market’s direction, User B manually closed the bot, resulting in a total loss of 10%.

These examples highlight the importance of setting up close triggers while using Grid bot to manage risks and maximize profits. It also shows the potential risks of trading in the volatile cryptocurrency market.

The Smart bot uses backtesting to evaluate the performance of a trading strategy using historical market data. By analyzing historical price data for a specific trading pair over a set period of time (in this case, 21 days), the bot can recommend parameters for live trading. This approach helps to maximize profits and reduce risk, providing users with greater confidence in their trading strategy. Follow our step-by-step guide to see how to create a smart bot on XREX crypto-fiat exchange here.

When you're setting up a Grid bot, you have the option to manually enter the trading details to adjust your personal strategy. With manual settings, you are required to select a grid strategy, set your desired lower and upper price range, and enter the number of grids you want to use. Optionally, you can choose to configure more with the advance settings.

For those with more expertise can use advanced settings to further configure the position. The advanced settings include selecting your grid mode arithmetic or geometric, and the option to set up start and close triggers.

Start and close triggers are important options to consider when using advance setting for the Grid bot. Start triggers allows you to set a price at which your bot will automatically open the position. On the other hand, close triggers allows you to set a threshold at which your bot will automatically sell your assets if the price drops below or rise above a certain level, helping you to minimize your losses. These features can be used in combination with the grid trading strategy to help you maximize your returns while minimizing risks.

When you locate the specific Grid bot for which you want to check, click on it and you'll then see three tabs titled: Transaction, Working, and Grid Details.

By reviewing each of these tabs, you can gain insight into your current positions and make informed decisions about your trading strategy. It is recommended to check your positions regularly.

The options for closing a Grid bot on XREX crypto-fiat exchange give you greater control over investments and allow strategies to be adjusted based on market conditions. This flexibility and control offers a convenient and effective solution to optimize crypto trading while minimizing time commitment.

You can opt to manually close the bot at any time by using measures such as Sell all at market price. You can also predetermine when to close upon creating the Grid bot by setting a Close triggers. By making use of these different closing options, you can optimize your trading strategy to achieve your desired profit targets while minimizing risk exposure.

Manually close a bot with the following measures:

Predetermine when to close a Grid bot with advance settings:

Stop and start triggers in grid trading are predefined conditions that automatically pause or resume your grid bot's operations based on specific market events. A stop trigger halts the bot’s activity when the market moves beyond a certain threshold, protecting your capital from significant losses in case of unexpected volatility or a sharp trend that could disrupt your strategy. Conversely, a start trigger reactivates the bot when favorable market conditions return, allowing your grid trading strategy to resume without manual intervention. These triggers help automate risk management and ensure your bot operates within the parameters you’ve set for safe and effective trading.

In grid trading, the key difference between short, long, and neutral trading lies in your market expectations and how you set up your grid to capitalize on them. Long grid trading is used when you anticipate an overall upward trend, allowing your bot to buy low and sell high as prices rise. Short grid trading, on the other hand, is for markets you expect to decline, with your bot selling high and buying low as prices fall. Neutral grid trading is designed for sideways markets, where prices fluctuate within a range, enabling your bot to profit from consistent, small price swings without a clear trend in either direction.

It's important to have a long-term investment mindset when using the Grid bot. The bot operates based on a strategy that aims to capture small, consistent profits over time, rather than attempting to make large, quick gains. It's also important to have a well-diversified portfolio and not to invest more than you can afford to lose.

The Grid bot is suitable for a wide range of traders, including both experienced and novice traders. It is particularly useful for traders who are looking for a hands-off approach to trading, as the bot will automatically execute trades based on the parameters you set.

A smart bot simplifies the trading process by automatically recommending parameters based on a 21-day backtest, requiring less input from the user. In contrast, a manual bot demands more attention from the user, as it requires them to fill in more details, including the trading direction (long, short, or neutral), price range, number of grids, and investment amount, providing greater control over the trading strategy.

Grid mode refers to the way in which intervals between buy and sell orders are calculated in the Grid trading strategy. Arithmetic mode uses fixed intervals, while geometric mode uses variable intervals that change based on market volatility. Arithmetic mode is best suited for stable market conditions, while geometric mode is better for volatile market conditions.

Matched profits refer to profits that are generated when the bot executes a trade and the price moves in the direction that was expected. Unmatched profits refer to profits that are generated when the bot executes a trade and the price moves in an unexpected direction. For example, if the bot buys a cryptocurrency at a low price and sells it at a higher price, the profit would be considered matched. If the bot buys a cryptocurrency at a low price and the price decreases, the profit would be considered unmatched.

"Total Profit" in the grid bot is calculated as the sum of your matched profit and your current unmatched Profit & Loss (P&L). Matched profit refers to the earnings from trades that have been successfully executed by the bot, while unmatched P&L represents the unrealized gains or losses from open positions.

You can withdraw grid profits from your active grid bot anytime through the grid trading bot page, enhancing investment flexibility. Once you initiate the withdrawal, the profits will be credited directly to your XREX wallet. If you prefer to keep your grid bot running, you can still withdraw profits without closing it, allowing you to reinvest them immediately.

Important Notes:

ROI, or Return on Investment, is calculated by dividing your "Total Profit" by the collateral you've allocated for trading. Collateral refers to the funds or assets you've committed to back your grid bot's trading activities. Understanding this relationship helps in assessing the effectiveness of your invested capital in generating returns.

The avg. entry price reflects the amount you've initially invested to open a Grid position. However, the avg. entry price including P&L considers both your initial investment and any subsequent matched profits.

In essence, the latter metric (including P&L) provides a more comprehensive view of your investment's actual performance, accounting for both initial expenditure and trading outcomes.

If the Grid bot is under loss, it's important to assess the reason. If the loss was due to market conditions, it's important to remember that this is a normal part of trading and to stay patient. If the loss was due to an issue with the bot's parameters, you may need to adjust them to ensure that the bot is executing trades in line with your desired strategy.