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grid trading explained: making money from sideways markets

grid trading explained: making money from sideways markets

via Dev.to PythonTateLyman

most people think you can only make money when prices go up. grid trading is the opposite idea — it makes money when the price goes sideways . the concept is simple. you set a price range, divide it into a grid of buy and sell orders, and let it run. every time the price drops to a grid level, you buy. every time it rises to the next level, you sell. each round trip is a small profit. it's boring. it's mechanical. and it works surprisingly well in choppy markets. how a grid works let's say SOL is trading at $150 and you think it'll stay between $130 and $170 for a while. you divide that range into 10 levels: $170 — sell $166 — sell $162 — sell $158 — sell $154 — sell $150 — current price $146 — buy $142 — buy $138 — buy $134 — buy $130 — buy you place buy orders at every level below the current price and sell orders above it. when the price dips to $146, your buy order fills. when it bounces back to $150, your sell order fills. that's a $4 profit on that grid level. multiply that by 10

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