AI: Friend or Foe to Traders?

[Webetcoins]

It's a friend for the traders who uses AI and got access to it and it's a foe for traditional traders like us, if AI could make technical analysis of the market within millisecond and decide what to do accordingly to the data available in the market for example the technical indicator and price action then we might be having big disadvantages here.
It'll be deadly combination if AI is combined with real time news, it could literally put order within just millisecond calling the exchange API if somehow there's really bad news relating to bitcoin out to the public.

but for now, AI seem to be not capable enough for that but eventually it will, the growth of AI has been exponential and I expect it to just get better

If you consider yourself as a traditional trader then you won't be here but traditional traders can always change and learn new stuffs like this AI.

To simply got an access to it, shouldn't be enough for us to say that it is our ally but it is when we now use it and find out the results. AI's are like bots and there must be bots already who can do what you said there, so why won't the AI be, when I think they are more advanced but IMO it's still best to not rely on them because we might notice things that they can not and this should make our analysis more wider and more effective than what they are always offering.

we might be having big disadvantages here.
It'll be deadly combination if AI is combined with real time news, it could literally put order within just millisecond calling the exchange API if somehow there's really bad news relating to bitcoin out to the public.

At first I thought it was only a typo when you say disadvantage but after reading the text next to it, I think you really mean it, didn't you? But we still can look at the bright side, and that is it can only make things faster for us.

[shield132]

I have a few questions for traders.

• Have you already encountered any AI-powered trading tools (aside from the AI Swallow I mentioned)?
• Which of these tools have been useful, and which ones were just a waste of time and money?
• And generally, do you believe that AI can become a trader’s ally and assistant? Or do you fear it might destroy the type of trading we’re all used to and leave us without a source of income?

Trading bots have been there before. AI is an addition to that word and that's all. I think that in the world of trading, AI is a buzzword for bots to sell many of them and increase revenue. Is there an AI bot that can read news on Cointelegraph and make a decision according to that? As far as I am aware, there isn't such a bot.

I wouldn't be able to sleep at night if I were to use a bot for my trading. The only automation that I use is that I make an order and will wait for days, weeks and months to get my order filled.
For a few months, I was trading daily and I swear I had a huge anxiety that I hadn't faced before because I was trading with thousands of dollars, which was a lot of money for me during that time, especially when inflation wasn't as high as it's today and the purchasing power of USD was good.

[yhiaali3]

For me, I only came across some AI tools in the exchanges, some of which were useful, while others were almost useless.

As for the question of whether AI can become an ally and assistant to the trader, I think that this is very possible, especially since AI does not have the emotions that always cause traders to lose, such as fear and greed, so I think that the presence of AI free of these emotions will be really helpful in making the right decisions for buying and selling.

As for the fears that AI may destroy trading, I do not find them justified and exaggerated, because what is the need for AI to trade without humans? In the end, humans are the ones who manage all these activities for their own benefit.

[Silberman]

For me, I only came across some AI tools in the exchanges, some of which were useful, while others were almost useless.

As for the question of whether AI can become an ally and assistant to the trader, I think that this is very possible, especially since AI does not have the emotions that always cause traders to lose, such as fear and greed, so I think that the presence of AI free of these emotions will be really helpful in making the right decisions for buying and selling.

As for the fears that AI may destroy trading, I do not find them justified and exaggerated, because what is the need for AI to trade without humans? In the end, humans are the ones who manage all these activities for their own benefit.

Even if AI is threatening to displace humans in a great range of activities, I do not think traders are at risk of being completely replaced, and this is because at the end AI has to use the same tools we use and be limited on its moves by the amount of money it has at its disposal, this by itself limits the potential of AI on this field, so human traders as long as they are good enough, should be able to trade alongside AI as they have done with bots for decades already.

[Wexnident]

• Have you already encountered any AI-powered trading tools (aside from the AI Swallow I mentioned)?
• Which of these tools have been useful, and which ones were just a waste of time and money?
• And generally, do you believe that AI can become a trader’s ally and assistant? Or do you fear it might destroy the type of trading we’re all used to and leave us without a source of income?

There are just too many AI tools out there that I can't be damn bothered to try any single one of them lol. If the exchange has an integrated one then pretty much that's just going to be the one that I'd use and otherwise, I'd just not use them at all! I've tried a couple of them before, some free some paid but they're mostly for tabulating data and making some summarized analysis. I sure as hell would not let it control my trades though, I'd rather use trading bots (predefined actions) than let AI take care of it.

Definitely think it can be an ally. Just that, it's more of an assistant than the decision maker. It tallies the data, let me knows that the same thing I'm going to do right now was something I did the same last month and I fucked it up really badly, so they're just going to warn me.

[Queentoshi]

Definitely think it can be an ally. Just that, it's more of an assistant than the decision maker.

AI Will be an ally when you know what trading is already and then just require some form of assistance, but AI will be a foe if you are a total stranger to trading and seeking for knowledge. It will be a foe because you may start depending on it too early and may never be able to get some kind of knowledge and learn something that you should know as a trader, you may skip those things because you have the idea that the AI can help you with those things. So, in conclusion, AI can be good for you when you already know what you are doing.

[tottong]

AI Will be an ally when you know what trading is already and then just require some form of assistance, but AI will be a foe if you are a total stranger to trading and seeking for knowledge. It will be a foe because you may start depending on it too early and may never be able to get some kind of knowledge and learn something that you should know as a trader, you may skip those things because you have the idea that the AI can help you with those things. So, in conclusion, AI can be good for you when you already know what you are doing.

This is true because actually Al can help someone when they know what they are doing but if the trading knowledge they have is not good it will not give maximum results.
People think too much about easy things but they never know the negative impacts that are generated if knowledge is not put forward.
It is a must for traders to have trading knowledge and there is no reason for success in trading if they do not have good knowledge.

Something must be learned based on knowledge and people can engage in trading without having to use Al.
So when thinking that Al can help then it is better to help knowledge so that we have ideas in running trades.

[yhiaali3]

Even if AI is threatening to displace humans in a great range of activities, I do not think traders are at risk of being completely replaced, and this is because at the end AI has to use the same tools we use and be limited on its moves by the amount of money it has at its disposal, this by itself limits the potential of AI on this field, so human traders as long as they are good enough, should be able to trade alongside AI as they have done with bots for decades already.

Yes, this is what I indicated, as artificial intelligence does not need money and does not own it in the first place, so there must always be someone who moves it and gives it money and orders to implement them, so control will remain in the end for humans.

Unless what some science fiction movies predict comes true, which depict artificial intelligence becoming one day like humans, even in terms of its ability to obtain money, deposit it in banks, and spend it to buy some needs, this may happen in the distant future, but at the present time I do not imagine that.

[EarnOnVictor]

• Have you already encountered any AI-powered trading tools (aside from the AI Swallow I mentioned)?

I don't seem to understand this question because trading/investing bots are rampant these days. The one developed by Coinbase is not so particular, it is just an integration with their system in my opinion, but will still need efficient monitoring to avoid issues.

• Which of these tools have been useful, and which ones were just a waste of time and money?

You would hardly find a useful trading bot and to be honest, I've not seen anyone with significant success for a long period.

• And generally, do you believe that AI can become a trader’s ally and assistant? Or do you fear it might destroy the type of trading we’re all used to and leave us without a source of income?

Mark my words, AI or not, nothing can break the financial market because it is dynamic, otherwise, it will affect the whole world. If they can't achieve that before now after many tries, I know they can't achieve it now according to my market experience.

[Mpamaegbu]

Here is the most dangerous thing about automation: the market may not be predictable but a computer program is. If its moves could be predicted, it could also be gamed....

Here's why I've yet to come around using bots in my trades. I'm always scared hard with that mindset of something could happen while I'm not watching. I can set a pending order for buy or sell and it doesn't go beyond that; it won't be for more than a trade. That trade should be one that I'm pressed to take because of its nice setup which I would've spend some time monitoring and don't want to miss. Otherwise, I steer off charts. Als don't have emotions like I do, they only rely on data.

[Reatim]

They can only execute predefined scripts and act according to certain signs they have seen. like noticing an increased volume and number of new buy orders then predicting a coming pump, and consequently making a "buy" move for profit.

Another risk of trading bots or AI is their inability to understand context. No bot, no matter how sophisticated and advanced, can piece together news and events and relate it to the market. Basically it most likely does not look at the bigger picture and only does as told.

Here is the most dangerous thing about automation: the market may not be predictable but a computer program is. If its moves could be predicted, it could also be gamed....

It’s definitely dangerous and pose a threat but I can also understand that this is the next best thing for some people. I would not recommend anyone to depend too much on trading bots without actual knowledge of how trading works. But it can help if you want to trade but just have not enough time to monitor closely. You would just have to acknowledge these risks if you really want to use it.

[Hamza2424]

AI is like a superpower for the trades which brings a lot of potential utilities, TBH in my view trade execution with the trading AI bots can be dangerous as you know programs can be manipulated with programs, but if these tools are utilized in some like data analysis and decision making it can boost the efficiency of a trader to next level. Until you are the main person in charge while trading Ai is your superpower and you are a superhero.

If this power falls into the hands of bots only this can be like a movie villain haha I'm being so comical but yup in my perception it is dangerous to trade with the AI-automated bots as they are just programs and programs can be corrupted and bypassed/tricked to destroy your portfolio, in simple manipulations can be done on a simple trigger.

[adaseb]

Here is the issue that we will encounter with these type of AI bots.

For one they use past events to predict future results. So after many analyses they can be helpful in entering or exiting a trade. However markets are very dynamic. For example the AI bot cannot predict some catastrophic event which might affect the markets like Covid did in 2020.

Even if these AI bots work. The more people use them, the less effective they will be. Because in an instant you will have thousands of people buying at once and it will cause the price to spike and then those that bought last will become bag holders. And then people will get smart and basically fade all these trades that these bots provide. If people will know that there will be a big spike due to thousands of people buying a certain crypto at a specific moment, they will fade all those moves and make money in reverse.

So if it works, it will work temporarily before too many people start to rely on them.

[jaberwock]

They can only execute predefined scripts and act according to certain signs they have seen. like noticing an increased volume and number of new buy orders then predicting a coming pump, and consequently making a "buy" move for profit.

Another risk of trading bots or AI is their inability to understand context. No bot, no matter how sophisticated and advanced, can piece together news and events and relate it to the market. Basically it most likely does not look at the bigger picture and only does as told.

Also their lack of emotion matters because a human would be able to fear something, and while fear is not always good and could make someone get out, there is no logic in a robot/ai/bot whatever you want to call it that will make it stop, so if anything goes wrong then there is nothing wrong for it to keep losing.

I have seen plenty of bots that didn't work as it should, making people lose 20%+ in a single day and it didn't care, if it was kept on then it would have lost even more, it doesn't care at all. While I understand that it might get done in a way that it could be very good compared to a human when it comes to strategies, doesn't mean that it feels anything about making money neither, so it will always be a failure and we shouldn't really consider that as a good thing.

We need to realize that this is a bad thing and we can't make money with these tools without putting some human in it. Which is why I always say that even if you use one, follow it up yourself and do not go to sleep when it's on.

[Natalim]

Believe if or not this is a very old question. Do trading bots work?

The answer is yes and no. The technology is definitely getting better, and with more advanced bots things are improving. But the thing about markets is that they are not predictable, which means a trading bot (call it AI or not) can not predict it. They can only execute predefined scripts and act according to certain signs they have seen. like noticing an increased volume and number of new buy orders then predicting a coming pump, and consequently making a "buy" move for profit. But it can never predict that some whale is going to suddenly decide to dump a large sum on the market crashing the price of that asset. Hence that move ends up in a loss.

Here is the most dangerous thing about automation: the market may not be predictable but a computer program is. If its moves could be predicted, it could also be gamed....

You are right in here. It could be useful and useless at some point. Using trading bots could promote fast and efficient trading transactions without emotions involved, but since we are dealing in an unpredictable market, trading without emotional and human intellectual intelligence will still end up useless. Trading is highly risky, that's why it needs to be taken with careful analysis and thorough planning so that it would create a positive outcome in the end.

[maydna]

Here is the issue that we will encounter with these type of AI bots.

For one they use past events to predict future results. So after many analyses they can be helpful in entering or exiting a trade. However markets are very dynamic. For example the AI bot cannot predict some catastrophic event which might affect the markets like Covid did in 2020.

Even if these AI bots work. The more people use them, the less effective they will be. Because in an instant you will have thousands of people buying at once and it will cause the price to spike and then those that bought last will become bag holders. And then people will get smart and basically fade all these trades that these bots provide. If people will know that there will be a big spike due to thousands of people buying a certain crypto at a specific moment, they will fade all those moves and make money in reverse.

So if it works, it will work temporarily before too many people start to rely on them.

Perhaps bot can not have the effectivity to analyze the market but at least, they can know when they can enter the market and what price they can start buying. When some people success in using the bot, other people will want to give it a try and that will make the situation is not good anymore because every people will want to make a profit using the bot.

And if more people also using the bot and make the competition becomes tighten so the dev will research and give newest update so the bot can works properly with the current situation. That will never ending ways for the developer because they must give the update to the bot  especially when the situation is always change. People also need to learn more to operate the bot because there will be many new feature that will be added by the dev.

AI bot needs to research more so that will work properly for people so testing the bot will be necessary before they launch the bot. We will see what will be with the AI bot later.