Home » Top Strategies for Trading NFTs Using An Automated Trading Bot

Top Strategies for Trading NFTs Using An Automated Trading Bot

by Dany

Automated trading bots are a great way to navigate the fast-paced and dynamic world of digital assets. Traders can take advantage of market opportunities by leveraging automated trading bots. We will explore in this article some of the best strategies to trade NFTs with an automated trading bot. This way can help improve your trading performance.

What Is NFT?

Before we focus on how to trade, first, we need to know what is NFT. Non-fungible Tokens (NFTs) are assets such as a work of art, a digital piece, game utilities, or a video, that have been tokenized using a blockchain. Tokens are unique codes that can be created by encrypting metadata. The tokens are then placed on a blockchain while the assets are kept in other locations. Uniqueness is based on the connection between tokens and assets.

NFTs are traded for money, cryptocurrencies, or other NFTs. It all depends on what value the market, and their owners, place on them. You could, for example, draw a smile on a banana and take a photo of it. The metadata is attached to the picture. It can then be tokenized on a blockchain. The token is owned by the person who has access to its private keys.

Cryptocurrencies are tokens as well; however, the key difference is that two cryptocurrencies from the same blockchain are interchangeable–they are fungible. The NFTs on the same blockchain may look identical but are not interchangeable.

How Does NFTs Work?

NFTs can be created by a process known as minting. The asset’s data is encoded and recorded onto a blockchain. The minting process involves creating a new block, validating NFT data by a validator, and closing the block. The minting process is often enhanced by smart contracts to assign ownership and manage NFT transfer. Tokens are given a unique ID that is directly tied to a blockchain address. Each token is owned, and ownership information (i.e. the address where the token is located) is publicly available. Each token can be identified even if there are 5,000 of the exact same item (similar to tickets for general admission to a film).

NFT Trading Strategies Using An Automated Trading Bot

1. Arbitrage Trading

Arbitrage trading is the act of taking advantage of price differences between different platforms or markets for a single NFT. Automated bots are able to scan multiple exchanges efficiently to identify price discrepancies. They can then execute trades in order to profit from these variations.

Execution: Configure your bot to track the price of NFTs across various platforms. If a price difference has been detected, your bot can purchase the NFT from the cheaper platform and then sell it to the more expensive platform.

Tools: You can use APIs from NFT marketplaces in order to integrate price data for real-time into your bot algorithms.

2. Trend Following

The bot will identify and follow existing market trends. This strategy assumes current price trends will last for a while, allowing bots to buy NFTs when the trend is upward and sell them during a trend that’s downward.

Configure the bot to identify trends by using moving averages, or any other trend indicators. The bot will then trade in accordance with the trend direction.

Use technical indicators such as Bollinger bands, MACD, or moving averages to help you determine the trend.

3. Mean Reversion

The idea behind mean reversion is that prices will eventually return back to their historical average. This strategy is used in NFT trading to buy NFTs at prices below the historical average and sell them when they are above it.

Execution: Program your bot to calculate an average price for an NFT during a specified period. The bot will then be able to execute trades if prices diverge significantly from the average.

Tools: Use historical data and statistical analysis to help you identify the price reversion to mean.

4. Momentum Trading

Momentum trading is the act of buying NFTs with a significant upward trend and selling those that are showing a downward trend. The strategy is based on the assumption that assets that have performed well in recent times will continue to perform so in the near term.

Execution: Configure your bot to execute trades based on recent price trends.

Use momentum indicators, such as the Relative Strength Index or Momentum Oscillator, to guide the trading decisions of your bot.

5. Volume-Based Trading

Volume-based strategies are based on the trading volume for NFTs. A high trading volume can indicate a strong interest in the market and possible price movements. Low volume, on the other hand, may indicate stability or lack of interest.

Execution Configure your bot so that it monitors the trading volume for NFTs, and then executes trades in response to spikes or falls in volume.

Tools: Keep your bot updated on changes in trading activity by using volume indicators and real-time data feeds.

6. Sentiment Analysis

Sentiment analysis is the process of gauging market mood through news and social media. Automated bots are able to be programmed in order to analyze sentiment, and then make trading decisions that reflect the mood of the entire market.

Execution: Integrate news feeds and social media APIs into the bot’s algorithms to analyze sentiments related to NFTs. The bot will then be able to execute trades according to positive or negative sentiment trends.

Tools: Natural Language Processing (NLP), tools, and sentiment analysis software will help your bot to interpret and act upon sentiment data.

7. Grid Trading

Grid trading is the practice of placing buy and sale orders at intervals predefined around a certain price level. This strategy allows the bot to take advantage of volatility in the market by buying low and selling high within a certain price range.

Execution: Configure your bot to execute a grid of orders for buys and sales at different price levels. The bot will trade as the NFT price fluctuates in this grid.

Grid trading algorithms can be tailored to suit the volatility and range of prices for the NFTs that you trade.

Coinrule: Redefining your trading experience

Coinrule is a crypto trading bot which whose function is to automate the trading process. The automated trading bot platform was first launched in 2018. The users can create and deploy strategies without needing advanced programming skills. Coinrule lets users create automated trading rules. These rules can be complex or simple depending on who is using them. These rules may be based on factors like price, technical indicators, and other conditions.

Coinrule offers a range of customizable templates for traders to use when building their portfolios. These templates are based on popular trading strategies, and they provide a great place to start for both beginner and intermediate traders. Users can create rules to test ideas and assumptions.

Coinrule is a platform that offers all of these features:

  1. Trading Strategy: Coinrule allows you to create automated trading rules. The user can choose to make the rules simple or complex. These rules can be based upon a variety of factors such as the price, technical indicators, and other conditions.
  1. Ready-Made Templates: Coinrule offers a wide range of customizable templates. These templates are based on popular trading strategies and can be a great starting point for beginner and intermediate traders. Users can create trading strategies to test ideas or assumptions.
  1. Demo Trading: Coinrule Demo trading allows you to practice without risking your trading strategies. Paper trading allows you to experience the thrill of market volatility while still enjoying paper trading. This feature is useful for both novice and experienced traders to simulate trends before trading real money.
  1. Market Scanner: Coinrule’s “any coin” scanner monitors price trends for more than 10,000 different cryptocurrencies. This tool allows you to find those that match your trigger prices or entry criteria. The main objective of the tool is to identify the most profitable markets and make sure you don’t lose out on any investment opportunities.
  1. Leverage Trading: Coinrule provides leveraged trading on multiple exchanges. Coinrule has many impressive features, including the “Any Contracts Scanner”. The “Any Coin” scanner is very similar to the market scanner described previously. It looks for leverage pairs that satisfy certain criteria.
  1. Educational Resources: Coinrule offers a wide range of educational resources that help users understand the platform and the world around cryptocurrency trading. There are guides, webinars, and tutorials. Discord Community and premium customer service are available.
  1. TradingView Integration: Integrate Tradingview to improve your skills. TradingView has the largest collection in the world of technical indicators. TradingView lets you create a strategy that meets your requirements. This integration connects seamlessly to your preferred cryptocurrency trading exchange via Coinrule


Trading NFTs using automated bots gives traders a strategic edge by allowing them to execute complex strategies quickly and accurately. Each strategy has its own unique advantages, tailored to the market conditions. Implementing these strategies can help you improve your NFT trading, reduce risk, and increase profitability. To maintain optimal performance, you must constantly monitor and adjust your strategies.

You may also like