Watch Grid Bot in Action
24 Hour TimeLapse of timelapse of trading action HERE
Getting the Right Files
First you need to download the required files. Let’s go to GitHub for that here and download the zip file. Here
Once you get the files, you will have the following folder. All you have to do is, to start editing the “settings page” and start the HFT Grid file.
Important Note: When you are adjusting your settings, all the numbers that contains the word “percentage” are to be put like you say it. If you want 1%, please type 1, if you want 0.1% please only type 0.1.
Set Up
Hosting: This isn’t a piece of the settings page. However, we would like to mention that you will need a place to host the bot. It can be your personal desktop or laptop. Though, if you want the bot to run 24/7, we suggest using a VPN Service. Please read our Hosting guide if you do not know what it is. Alternatively, we offer hosting and set up, please contact us if you want us to help you get set up.
License key: Please put the license key provided by HFT Research FOR FREE. The bot will not work without a valid license key.
The License key to use: OVtXZwaUdyHdIMTylhmwwqzmVJnITFNf
Platform: Currently this version of the system works on BinanceSpot market.
Public key: Place your public API key here
Secret Key: Place your Secret API key here
Symbol: Select the pair you would like to trade. Any pair that’s listed on Binance will work. Example; BTCUSDT
Grid Side: In spot market, you can only choose this “Buy”. This piece of setting is intended to be used when we introduce the futures market for grid bot.
Creating the Grid
Order Size: This is where you select how much you would like to commit to each of the grid levels. We will cover how to calculate the right size relative to your account. If you are in USDT market, you need to put your order size in that currency. For example, BTCUSDT market would require you to have USDT in your wallet and would require you to select order size in BTC amount like 0.001. On the other hand, if you are in BTC markets like BTC ETH, then you would need BTC in your wallet and would select order size in ETH like 0.1. Otherwise, you are likely to get an error that says “Insufficient balance”,
Number of Buffer Orders: Here, you choose how many orders you want to keep open. For example, if the price is 20% away from your last order, there isn’t really a need to keep that order open. So, the bot can close that and reopen it when the price gets there. Usually, buffer size of 10 is ideal and easy on the API call limits.
Gird Order Spread Percentage: It represents how far you each order should be. Let’s say you want to cover, 10% of price range from the current price. You can choose to place 10 orders with 1% spread between them, or you can choose to place 100 orders with 0.1% spread between them. Both approach would cover 10% range. It is a preference and different bankroll management styles.
Grid Coverage Percentage: This is where you choose how much of an area you want grid to cover. For instance, you can be extremely safe and can cover 100% of the price range. Or you can take more risks and a hands on approach by choosing to cover a small area and adjust that on a daily basis.
Safety Measures
Price Break Stop: If this is turned on, the bot will use the settings below in order to lower risk on the account. Otherwise, it will ignore the next 2 pieces of settings.
Grid Stop Profit Price: The bot will stop the grid, cancel all orders and sell all holdings in that pair when the price reaches this specified levels. You can treat this as your “Take Profit” level and let the bot know where to stop.
Grid Stop Loss Price: You can use this as your “Stop Loss” level. When the price gets to this point, the bot will stop, cancel all orders and sell all holdings in that pair.
Important: This is set to 1 as default. If you are using any BTC pairs, the price will be below 1 such as, 0.001. Therefore, you need to adjust this down to 0.0000001. Otherwise, the bot will shut itself down thinking that we have hit stop loss price.
Profit Calculation
bnbFeeOn: This is an optional setting and solely used for profit calculation. It has no effect on the trading action. Set to true if you are using BNB to pay the fees.
feePercentage: Every account has different VIP levels and pay different fees. Put in how much fee you pay.
Potential Error
If you have gotten this far and you find that the bot is on but not placing orders, there is a 99% chance that it is because of a server time issue. This happens when your machine’s clock is not synced with Binance’s server time. You can easily fix this small issue by following the steps HERE
Thoughts
Overall, Grid trading strategy is a very reliable and safe way of trading. You trade on spot market which means you have no liquidation risk as well as no funding fee. So, there is really no downside of holding a position other than the opportunity cost. However, because each grid level is independent from each other and each grid level only interacts with the next grid level, you are always going to be trading actively. That covers the opportunity cost in a way.
Examples of Different Style
High Risk
Traders who have experience and high tolerance usually use the grid trading system in this way. On a daily basis, they look at the market and choose a range in which they believe the asset is likely to move. For example, trader strongly believes that Bitcoin will trade between 10,000$ and 10,200$ for the day. Therefore, he sets his grid to cover only 2% range and focus all of his capital in that range. As you can see, if the traders initial assumption goes out of the window and Bitcoin trades below 10,000$, the trader is exposed risk and a drawdown. However, on the other hand, if the price ranges in the predicted price, then the trader is looking to make huge gains. This approach requires the most hands on management as well as the most experience in the market. You can be a bag holder very quickly and have no capital left to trade at the current range. If you are a starter, we recommend to start from the low risk version.
Moderate Risk
This risk profile is the most common among traders. Unlike making a daily prediction, you can make a wider assumption and have more wiggle room. For instance, you assume Bitcoin will not dump 50% in the near future. So, you bank on that and cover 50% range from the current price. You are relatively safe however, a dump of 50% or more can leave you holding a bag of Bitcoin. However, based on historical performance, you are likely to get out of that position sooner or later.
Fool Proof aka Low Risk
Low risk profile is what we suggest to everyone who is trying this system for the first time. It gives you pretty much no risk and an understanding of how the bot exactly works. You cover 100% which means wherever the price goes, you always have funds to trade.
Risk Factors to Consider
Calculating Profit: Calculation is pretty simple with only a few variables; (grid order spread percentage x order size) – (order size x fee percentage) = NET profit
Essentially, if you are trading with 100$ per order with a spread of 1%, you make 1$ profit before fees per trade. If your fees are 0.1%, you would have made NET profit of 0.9$ per trade.
Drawdown potential: Unlike Futures market trading, you don’t experience direct drawdown in your account as you are not actually closing any positions. However, you are holding BTC and USDT at the same time in order for grid levels to be active and working. So, when the price goes down, you will have accumulated some coins that are above the current price. Naturally, those buys will be underwater.
How to break even on the losing buys?
This is a question many of you might be asking right now. What do I do with the buys that I had before the price has gone down? Well, you keep those open while you are trading the lower range of the grid levels. You don’t need to be trading at the top of the grid level in order to profit from the strategy. If one a buy is now in negative by 10 grid levels, you need to do 10 trade at the current grid level in order to recover from the momentary loss of the buy from 10 levels above. So on and forth for level 9, 8 ,7 and so on. This may be a little confusing but prices don’t always trend in one way or another. Sometimes, price stays stagnant and trades within a range. That’s where grid bots shine because they are able to profit from the sideways action which recovers the loss made before the move.
Closing Thoughts
There are many different ways to use this bot. You can fully automate it with extremely safe settings and be ready for any kind of price action. Or, you can choose to make your entries with TradingView scripts and let the bot dollar cost average into. On the ultimate end of the stick, you can be pretty aggressive and scalp the market when there is low or high volatility if you have time to baby sit the trades. It is really up to the imagination of the user at this point! That being said, we are always more than happy to help you strategize through it on discord or telegram!
Finally, we advise and personally use this bot on Binance
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Please check out our other bots here and read our blog for more educational content for trading here
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