In market making bot development, managing market volatility is crucial for maintaining profitability. A market making bot adjusts its bid-ask spread dynamically, widening it during high volatility to account for rapid price swings and reducing exposure to sudden losses. It may also use stop-loss mechanisms to minimize risk, automatically pausing trading if market conditions become too unstable. By monitoring liquidity, price fluctuations, and market depth in real-time, the bot ensures it trades safely, even in volatile environments.
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