Algo Trading in Volatile Markets

In just a few months the coronavirus pandemic has caused the markets to go belly up. The markets, going strong for the better part of a decade, started taking a nosedive globally around mid-late Feb this year. The bears gripped the markets and within the next one month the BSE SENSEX lost over 15189 points. In the US too, Dow Jones Industrial Average lost over 10000 points, and S&P lost over 1136 points.
Algo Trading in Volatile Markets

Market volatility and instability causes great anxiety in the minds of investors. Besides market data people also tend to rely on daily news-flow which might not be related to markets. Bad news creates fear. The psychological aspects are highly driven by fear of losses and further crush in the exchange. Read our article on psychological factors which affect trading for more info.

Using automated systems for trading can take the fear factor out, and help you trade based only on cold, hard data. If you're a day trader, consider creating your own trading strategies. Once done, you can deploy these strategies on trading systems to trade on your behalf. There are many advantages to trading using strategies: