If you are part of an investment community, the expression "catch the falling knife "sounds very familiar to you. In trading, this phrase is commonly used and describes the attempt to make up the losses on an equity holding that has quickly lost a considerable part of its value.
If you are a trader, you must try to "catch the falling knife" by buying it at or around its low point.
Because cryptocurrencies are highly volatile assets, there are opportunities to catch "falling knives." Buying coin dips during a downtrend can be risky. However, it may be an appropriate investing move during a Bull Market or when market participants' overall mood is cheerful.
Coinrule, a crypto trading tool, has implemented trading bots that make it easy to automate crypto trading strategies. It offers automated trading templates also for catching the falling knife, or you can build it yourself step by step.
The opportunity of catching the falling knife occurs mainly when the market goes through a “panic selling,” namely, the coin holders take one after another and start selling off in mass plummeting. This phenomenon takes place, especially in volatile market periods.
Panic selling circumstances generate opportunities when the market is generally trading to the upside.
But profiting from a falling knife is highly time-consuming if carried out manually, which is where Coinrule's automated trading bot comes to help. When the market price of the position reaches a predefined level, the rule will generate new buy and sell orders to catch the falling knife.
You can catch the falling knife using Coinrule’s automated strategy. The “Catch the Falling Knife” automated strategy regularly purchases the most popular coin on the market with a 3% take profit. The system includes a stop-loss to protect against unexpected losses if the downtrend continues. Moreover, users can create a rule that automates the Catch the Falling Knife with an Exception process.
If you start using Coinrule, you can choose one of its automated trading strategies without coding and from the beginning for free.
The first step is to pick the reason that brought you to Coinrule: to make a profit, to trade better, or to run a trading strategy. On the platform, you can experience trading to another level, becoming a better trader. If you are unsure what trading strategy you want, you can choose from over 180 pre-existing trading templates.
The second step is to determine your level of experience: beginner, intermediate, or expert. Then, choose your favorite coins.
Meanwhile, Coinrule will recommend templates based on your preferences so that you can start with one of them. The best part is that you can first enter a test mode to learn how the process works. You must select the coin to trade, the time frame to trade, and the trading strategy.
Your account plan determines the number of rules you can use, the number of exchanges you can connect to, the trade volume, and the number of trading templates you can access. Each has its own set of rules, strategies, and benefits that are appropriate for various trading levels.
Along with a free plan, Coinrule has 3 types of paid plans:
Buying coins during severe drops can be suitable, but it is also risky. To chase a strong rebound, buy the currency that is falling the most on the market regularly. To secure the bounce up, use a stop loss and a take-profit to protect yourself from further drops.
Use secure platforms as Coinrule is and give a chance to their automated strategies. Also, do not forget to be informed, make your research, and trade safely. You can access information about strategies, trading, and more on the official Coinrule website.
Disclaimer. This article is paid and provided by a third-party source and should not be viewed as an endorsement by CoinIdol. Readers should do their own research before investing funds in any company. CoinIdol shall not be responsible or liable, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any such content, goods or services mentioned in this article.