A DCA crypto trading bot is a highly efficient tool designed to manage and generate passive income through systematic market strategies. The core principle behind dollar-cost averaging (DCA) bots is to buy a certain share of assets after a predetermined price variation has occurred, ensuring that investments are made incrementally over time rather than in a single lump sum. This method is particularly beneficial during periods of short-term market decline, as it allows investors to spread their risk over multiple purchases instead of risking a large sum of money all at once. Most individuals who are keen on minimizing risk and maximizing potential returns will attempt to apply the DCA trading strategy during such market conditions. By doing so, the DCA technique effectively mitigates the danger associated with investing a significant amount of capital in a volatile market environment, thereby providing a more balanced and strategic approach to investment.
The DCA bot tab has 3 core areas: the chart of the selected asset, the settings of the DCA bot and the created bots underneath the chart.
Chart
The chart shows you the asset that you have selected in the settings of the DCA bot from the exchange. You can add the indicators to the chart to improve your understanding of the current market situation.
DCA Bot Settings
In the bot settings, first choose your exchange and API. This determines where you want to run your DCA bot. After picking the exchange, choose the trading pair for your DCA bot.
The next step is to select the direction of the bot. "Long" will open only buy trades, "short" will open only sell trades and "both" will buy and sell, depending on market conditions and chosen indicator.
Reminder: If you would like to create a DCA bot in the short or both directions on the Spot exchange, please ensure that you have the asset in your exchange wallet. For example, if you want to launch a BTC short DCA bot, then you need to have BTC in your Spot exchange wallet.
We recommend using Cross Margin Mode for safer trading. Note that Isolated Margin can carry a higher risk of position liquidation.
Next, you need to determine the Amount per trade. This parameter sets the size of your initial position when your first entry order is placed. After selecting the amount to trade, the bot will display how much is needed and what assets are available on the connected API. The required amount includes the bot's DCA settings (Order Size Multiplier and Maximum Number of DCA Orders).
You can also select the type for the Amount per trade. This can either be in the quote or base currency, or as a percentage of the total available amount.
Bot Start Conditions
The next section in the bot settings will determine the starting conditions for your bot. Please refer to the table below:
Bot Start Condition | Descriptions | Settings |
Immediate | Under this condition, the bot will enter the position as soon as possible, regardless of the market. As soon as the bot completes the strategy, it will immediately open another in the same direction. |
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RSI | The bot will use the RSI oversold region for the “Long” DCA bot and the overbought region for the “Short” DCA bot. | Timeframe: 15 minutes |
MACD | The bot will use the MACD indicator to determine the entry points. For the “Long” DCA bot the entry condition is when the MACD line crosses the signal line while both of them are below the 0 line. For the “Short” DCA bot, the condition is reversed. | Timeframe: 15 minutes |
Bollinger bands | The Bollinger Bands indicator will signal entry for the “Long” position when the price of the asset closes below the lower band and the next candle closes above the lower band. The reverse is true for a “Short” DCA bot entry. | Timeframe: 15 minutes |
Price Change | This indicator monitors price movements over a fixed interval. If a price decline is detected, the Long DCA bot is triggered. Conversely, if a price increase is observed, the Short DCA bot is activated. | Period: 15 minutes |
After selecting the bot starting condition, you can fine-tune the bot settings. If you do not have a specific DCA strategy in mind or lack experience with DCA strategies, you can select our Automatic settings, which provide a general preset suitable for most assets and indicators.
However, if you would like to customize the settings for the DCA bot, you can select Custom settings. In Custom settings, there are two main blocks. The first block is dedicated to the DCA settings, which includes 5 core parameters: DCA Mode, Max DCA Orders, Price Deviation, Order Size Multiplier and Price Deviation Multiplier.
DCA Mode
DCA mode parameter allows to choose between "Position averaging" or "Order averaging". "Position averaging" is the default logic, where first Extra order has the same amount as entry order, meaning that DCA parameters will apply starting from the second extra order. However, "Order averaging" applies Order size multiplier starting from the first DCA extra order.
Averaging Method
Averaging method allows you to choose between Fixed coin amount and Fixed order value.
Fixed coin amount makes each DCA order buy the same amount of the asset (e.g., 0.01 ETH). Fixed order value makes each DCA order use the same amount of quote currency (e.g., $20).
Max DCA Orders
This parameter determines how many additional entries your overall strategy will have.
Example: If you enter 3, this means that including your initial position, you will have 2 additional orders.
Price Deviation
This is the value in % that determines the deviation of the additional entries from the entry price.
Example: If your entry price is $100 and you set a 1% price deviation, the first additional entry will occur when the price drops by 1%, while the second entry will be triggered when the overall price drops by 2% (as the interval between the first and the second additional entry is 1%).
Order Size Multiplier
This parameter defines how much is added with each additional position. If the multiplier is equal to 1, each additional entry will be equal to the initial amount. The extra volume will be added to your position from the second DCA entry.
Example: Your initial position was $10 and your Volume Multiplier is set to 2. When you reach your 1st DCA extra order target, your additional order will have the same volume of $10. When you reach your 2nd DCA target, your extra order will be $20 (previous position volume * multiplier). Your 3rd DCA target will place an order of $40.
Price Deviation Multiplier
This value increases the price deviation between each additional entry. It is calculated as the price deviation multiplied by the deviation multiplier.
Example: If you enter a long position at $100 and have a price deviation of 1% with a price deviation multiplier of 2, the first additional entry will occur when the price drops to $99. However, the second will occur when the price falls to $97 (deviation of 3% = 1% * 2). The third additional position will be entered at $94 (deviation of 6% = 3% * 2).
Exit Parameters
Once the bot enters the trade, you have several settings to define the strategy’s exit. You can select either one or multiple exit conditions. These are: Take Profit, Stop Loss, Move Stop Loss to Breakeven, and Trailing Stop.
Exit Conditions | Input | Type |
Take Profit | The percentage the asset must move in the trade's direction to lock in profits. | Based either on the average price or the initial order. If Take profit is based on the entry order, the Take Profit price target will be fixed. If the Take Profit is based on the average entry price of the position, the Take Profit percentage will be fixed. |
Stop Loss | The percentage of the asset that must go in the opposite direction of your trade in order to stop losses. | Based either on the average price or the initial order. If Stop Loss is based on the entry order, the Stop Loss price target will be fixed. If Stop Loss is based on the average entry price of the position, the Stop Loss percentage will adjust based on the average price of your position. |
Trailing Stop | Percentage for activating and executing the Trailing Stop. You can read more about the Trailing Stop function here. | Based on the average price. |
Move Stop Loss to Breakeven | The percentage the asset must move in the direction of your trade for the Stop Loss to move to the entry price. You can read more about the Move Stop Loss to Breakeven function here. | Based on the average price. |
If your Stop Loss and Trailing Stop share the same price level, the Stop Loss will take priority, and the position will be shown as closed using Stop Loss.
Backtest & Optimisation
Backtest
Once you have finished setting up your bot, you can check your settings using the Backtest button. The backtest simulates performance over the past 30 days. After it completes, a graph with all trades will appear along with detailed results on the right-hand side.
Optimize
The Optimize function runs multiple backtests to find the optimal DCA parameters and Take Profit percentage based on the maximum profit for the past 30 days.
Live Bots
After selecting, backtesting and optimizing your parameters, you can launch your DCA bot. Newly created bots will appear underneath the price chart.
Next to each bot, you will find a set of available actions that you can apply to the bot:
| Stop your bot – Stops new entries. In the pop-up window, you’ll have two options: leave trades open (the system will continue monitoring them); close all open positions at the current market price. |
| List of your strategies – Displays live and historical strategies executed by your DCA bot. |
| Open Settings – Displays your DCA bot’s settings. |
| Delete the bot – Removes the bot from the list and deletes all its history. |
| Edit button – Allows you to change settings of your active DCA bot. |
Max Open Position Settings
The Max Open Positions setting controls the maximum number of strategies your DCA bots can have open cumulatively at the same time. Once the limit is reached, any new trade signals will be ignored or canceled until one of the existing strategies closes. This feature helps manage risk, control capital allocation, and prevent excessive trading.
