Understanding Grid Trading with Fokawa
Grid Trading Overview
Grid trading is a quantitative trading strategy automated for spot and leveraged token (ETF) markets. It involves placing buy and sell orders at predefined intervals within a set price range, creating a grid of orders above and below a chosen price point.
This strategy is particularly effective in volatile markets where prices fluctuate within a specific range. By capitalizing on small price changes, grid trading helps you trade systematically and minimize emotional decision-making.
Risk Warning
Grid trading is designed for volatile markets, but it carries certain risks:
- Uptrend Risks: In a strong uptrend, the strategy may execute sell orders, leading to potential losses if the price continues to rise beyond the set range.
- Downtrend Risks: In a sharp downtrend, the strategy may place buy orders, resulting in losses if the price falls below the set range.
Important Reminders
- Starting Grid with USDT: The system will use 50% of your USDT investment to purchase BTC at market price before activating the grid strategy.
- Stop Loss (SL): When the market price hits the Stop Loss price, the grid will cease operation, cancel all orders, and sell any remaining BTC at market price.
- Manual Closure: To manually close the grid trading, all orders will be canceled, and remaining BTC positions will not be sold.
Getting Started with Grid Trading
Select Spot Trading: Choose BTC/USDT and click on Grid to begin.
AI Policy
- AI Recommendations: The system will suggest optimal grid bot parameters based on the past seven days of market data.
- First-Time Users: For beginners, using the AI strategy is recommended. Simply decide your investment amount to set up the grid trading bot.
Custom Policy
- Parameter Settings:
- Lower Price: Minimum price for grid trading. No orders will be placed if the market price falls below this level.
- Upper Price: Maximum price for grid trading. No orders will be placed if the market price exceeds this level.
- Number of Grids: Determines the number of price intervals. More grids result in smaller profits per grid.
- Arithmetic & Geometric Modes:
- Arithmetic Mode: Equal price difference between grids (e.g., 1, 2, 3, 4…).
- Geometric Mode: Equal price ratio between grids (e.g., 1, 2, 4, 8…). Profits are proportional between each grid.
Advanced Settings
- Take Profit and Stop Loss (TP and SL):
- Stop Loss (SL): Grid trading will stop and liquidate positions at market price when the SL price is reached. SL should be lower than the set range.
- Take Profit (TP): Grid trading will stop when the TP price is reached, and positions will be liquidated. TP should be higher than the set range.
- Invested Coin:
- BTC Only: Uses BTC from your Spot Wallet.
- BTC + USDT: Uses both BTC and USDT from your Spot Wallet.
Viewing Grid Transactions
- Select Grid Status: Choose either Processing or Completed.
- Click Details: View overall grid status, pending orders, and completed transactions.
Understanding Grid Profit
- Grid Profit: Profit from completed grid orders, with trading fees already deducted.
- Annualized Yield: Calculated as [(grid profit/investment) / (Lasting time/365)] * 100%.
- Position Gain and Loss (USDT): Difference between the latest price and the opening price, reflecting floating profit/loss.
Start Your Grid Trading with Fokawa Today!
Grid trading is a quantitative trading strategy automated for spot and leveraged token (ETF) markets. It involves placing buy and sell orders at predefined intervals within a set price range, creating a grid of orders above and below a chosen price point.
This strategy is particularly effective in volatile markets where prices fluctuate within a specific range. By capitalizing on small price changes, grid trading helps you trade systematically and minimize emotional decision-making.
Risk Warning
Grid trading is designed for volatile markets, but it carries certain risks:
- Uptrend Risks: In a strong uptrend, the strategy may execute sell orders, leading to potential losses if the price continues to rise beyond the set range.
- Downtrend Risks: In a sharp downtrend, the strategy may place buy orders, resulting in losses if the price falls below the set range.
Important Reminders
- Starting Grid with USDT: The system will use 50% of your USDT investment to purchase BTC at market price before activating the grid strategy.
- Stop Loss (SL): When the market price hits the Stop Loss price, the grid will cease operation, cancel all orders, and sell any remaining BTC at market price.
- Manual Closure: To manually close the grid trading, all orders will be canceled, and remaining BTC positions will not be sold.
Getting Started with Grid Trading
Select Spot Trading: Choose BTC/USDT and click on Grid to begin.
AI Policy
- AI Recommendations: The system will suggest optimal grid bot parameters based on the past seven days of market data.
- First-Time Users: For beginners, using the AI strategy is recommended. Simply decide your investment amount to set up the grid trading bot.
Custom Policy
- Parameter Settings:
- Lower Price: Minimum price for grid trading. No orders will be placed if the market price falls below this level.
- Upper Price: Maximum price for grid trading. No orders will be placed if the market price exceeds this level.
- Number of Grids: Determines the number of price intervals. More grids result in smaller profits per grid.
- Arithmetic & Geometric Modes:
- Arithmetic Mode: Equal price difference between grids (e.g., 1, 2, 3, 4…).
- Geometric Mode: Equal price ratio between grids (e.g., 1, 2, 4, 8…). Profits are proportional between each grid.
Advanced Settings
- Take Profit and Stop Loss (TP and SL):
- Stop Loss (SL): Grid trading will stop and liquidate positions at market price when the SL price is reached. SL should be lower than the set range.
- Take Profit (TP): Grid trading will stop when the TP price is reached, and positions will be liquidated. TP should be higher than the set range.
- Invested Coin:
- BTC Only: Uses BTC from your Spot Wallet.
- BTC + USDT: Uses both BTC and USDT from your Spot Wallet.
Viewing Grid Transactions
- Select Grid Status: Choose either Processing or Completed.
- Click Details: View overall grid status, pending orders, and completed transactions.
Understanding Grid Profit
- Grid Profit: Profit from completed grid orders, with trading fees already deducted.
- Annualized Yield: Calculated as [(grid profit/investment) / (Lasting time/365)] * 100%.
- Position Gain and Loss (USDT): Difference between the latest price and the opening price, reflecting floating profit/loss.
Start Your Grid Trading with Fokawa Today!
Updated on: 23/07/2024
Thank you!