With the emergence of cryptocurrencies as a new class of assets for investments, speculation, and trading purposes, the new technology for copy trading is in huge demand.
AIVIA is one of the top providers of such technology, that enables leading traders to share their winning strategies with regular cryptocurrency hodlers we call them followers.
As everyone knows not all trading strategies are equal. But all of them carry a certain degree of risk and provide different opportunities for profit.
In this post, we would like to explain the most effective strategies for copy trading and will point out some of the strategies to avoid.
First, let's talk about the best and most effective strategies. The copy trading technology works best with the most liquid pairs. The most effective copy trades are those that use counter-trend patterns as an entry point. These strategies are used to make profits on corrections (pullbacks) of the main trend. Professional traders use different patterns and indicators to find ideal points of entry and exit the trades. There are a few reasons these strategies are most effective for copy trading.
First of all, they allow followers to enter trades at the market price that are slightly better than leading traders. Another reason these strategies are great is that they are not very frequent; they might be from a few trades a day to a few trades a week, depending on the volatility and the time frame used to identify the pattern. The majority of the counter-trend strategies are more effective and more profitable for the followers, which provides better earning potential for the leading trader.
Some of the strategies are proving to be less than ideal for copy trading. We are strongly discouraging scalping. Scalping is very risky and creates many challenges for copy trading.
The limited liquidity at certain price levels can be one of the reasons the strategy might fail. The limited-time between entry and exit points is another challenge.
Usually, scalping involves high leverage which increases the risk exposure while limiting the profitability.
In any case, we strongly encourage every user to do their own research, on which strategy best addresses their needs.
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If you are interested in providing copy trading services under your brand, we provide institutional-grade copy trading technology solutions for professional traders, prop trading companies, and traders with large communities or persons and entities that are looking to establish a copy trading business. Set up is free of charge.