Best Forex Robots – How to Win more?
Forex is an abbreviation for foreign exchange market or currency market which is a global decentralized market for the trading of currencies. A robot is a machine with the capability of performing complex actions automatically, especially one programmable by a computer. A Forex Trading Robot is a computer program/specific software designed to study the market for humans. A Forex Robot which is also referred to as a “Forex Expert Advisor”, abbreviated “EA” is an automated system intended to perform the task for a forex broker, it is written in MetaQuotes Language 4 (MQL 4). These robots will accurately carry out the actual trading instead of the human trader.
This program (robot) has the ability to dissect data, discover patterns that can propose when and where a new trade could provide a probable profit. Be mindful, though these robots can trade without a broker being present, it is not enough for them to be left alone and unchecked. There are many factors which must be put into necessary consideration which may lead to rapid changes in the Forex market and this is where a broker comes into play by his or her knowledge of the market. The program is based on a set of Forex Trading Signals which helps establish whether to buy or sell a currency pair at any time.
Forex Robots are most frequently programmed to execute trades automatically which means, the user involvement is minimal in making any trading decisions. If correctly programmed, a robot can handle all aspects of one’s trading operations.
How Do They Work?
Exploring the analytical abilities of computers, a Forex Trading Robot looks at the past performance of a certain currency pair. Examining its short and long-term performance, it looks for trends that have occurred frequently throughout the currency pair’s trading lifetime. It looks for troughs, for massive gains in value, and for persistent events that drive the currency’s value up or down.
This knowledge allows the robot to perform its own trades based on the past performance of the currency pair. It trades based on wherever its data would suggest the next trend up or down is going to be. It examines the currency pair and invests in or against it based solely on the events in the currency pair’s past. It reads and puts the data to use. This often results in positive results, in fact, for brokers that have used these robots, it has been the key to success in account value, although it is not a foolproof system. There isn’t a guarantee that market conditions will remain the same as they always have. The world’s economies differ from a computer which is a binary i.e. yes or no type of system. They’re very human and dynamic. Hence there are scenarios which exist outside of the robot’s reality, many of which can throw it out and dent its otherwise perfect investment strategy. However, there is an option. The analytical power of a robot is really great and it is often impossible to be beaten by a human. Pairing this power with a trader that’s in tune with global currency markets and able to monitor the robot can produce some positive results.
How to Choose the Best Program?
The following should be put into necessity in choosing the Best Forex Robots:
Determine what you need
Firstly, determine what you need, it’s well known that different Forex Expert Advisors can be programmed in a way that they make different decisions. They can run on series of different algorithms, which is why a broker needs to first determine what they need before moving to actually finding a good Forex EA to ensure it meets his specs.
Create a list of all the Forex EAs who are capable of providing what you need
The next step would be to find each and every single Forex Robot that meets your specs and create a list. Ensure you enlist every single robot that offers all the things required in order for a foolproof process.
Check out all the Forex EAs on your list and start eliminating
Eliminate the EAs that do not offer all of the things required. It is only through the process of elimination, the process of choosing one Forex Expert Advisor out of the many in existence will be easier for you. This process will result in a handful of options to choose the best from. Others are:
- Referrals from experienced traders: Regular Forex traders usually have handful information about brokers who have not performed to expectation or conducted business in an undesirable manner since the robot is only as good as the brokerage offering it.
- Establish if the robot is robust and in line with your expectations of return: you must determine if your robot is sustainable. That is backward and forward testing it through a range of market conditions.
- Perform extensive testing of your robot before taking it live.
- Start trading live on a micro account to minimize losses.
Advantages/Benefits of Using Robots
Timing and strategy are major factors when it comes to the benefits of forex robots. They are programmed to execute trades and take advantage of such, which have potential for profit, and this could happen in the middle of the night when the trader is sleeping. Others are:
It is not susceptible to emotions.
Every Forex broker has perhaps grappled with either greed or the fear of losing at some point. Human emotions can blur decision-making sometimes and can lead a trader to deviate from a favourable strategy. The trading robot does not have any emotional components at all. They are wired to stick to system commands and take suitable trade signals, without feeling pain from losses or delight from wins.
It reacts to quick market schedule instantly.
While humans may take few seconds or longer to digest market information and figure out how to react to price movements, a Forex Robot can react instantly and execute a trade faster within the blink of an eye. This can be helpful for day traders who are looking to profit from quick price moves based on charts. It can also book profits or cut losses without second-guessing.
It is less prone to error.
Apart from having emotions interfere with making trading decisions, being human also entails making mistakes.