Automated Forex Trading
Automation has reaffirmed its authority in the world of trading and the financial markets just as it has in many other industries which include the forex market. Traders have the opportunity to opt for automated forex trading which is a method of trading currencies with the help of a computer program that determines through signals whether it is the right time to buy or sell a currency pair based on a set of analyses. The analyses are derived from technical analysis charting tools through which signals create a buy or sell decision. These trading systems and signals can be purchased online while some big time traders and financial firms keep their systems a secret.
Types of trading systems
As a forex trader it is essential to choose a reliable trading system. Primarily, there two types of automated forex trading systems which includes discretionary and mechanical. For beginners, discretionary trading systems are the best way to learn the parameters of automated trading. This system allows traders to make trade decisions based on their technical and fundamental strategies. On the other hand, mechanical trading systems use programs to specifically time trades. One of the first steps in the assessment of a trading system is testing. It is essential to select a system that features both back test and forward test data, which eventually determines the accuracy of the program and the simulation of how the program works.
Choosing an automated trading system
For traders beginning out in forex, it is most important to choose an automated trading system that is easy to use and with system requirements that match your computer. In addition, it should have a smooth and easy navigable user interface. One of the systems to avoid is one with too much of clutter. Important information should be easily accessible and well laid out. There are systems that offer a short- summary page for assessment of any current trading situation. Look for features such as automatic back-testing and customization so that it is easy to adjust the system for preferred signals. Make sure the system provides regular updates especially since the forex market is continuously developing which requires quick adaptation to market moves. Choose a system with 24/7 customer and tech support should there be any problems. You can always do a bit of research, read reviews on forex forums, and find out what other traders have to say about different systems. Most reliable systems will offer a refund. Most importantly, ask for a trial run before you make a purchase decision.
Wide range of benefits
One of the advantages of automated trading systems is that they cost as little as $100. Installing a system means less work since the software does most tasks such as collating, analyzing and comparing data, performing profitable transactions and more. Since they can run 24/7, picking up critical information is one of the most vital aspects while you as a trader get to concentrate on other important tasks such as studying historical data to determine any change in the system’s parameters that could be modified as deemed fit.
There are several automated trading systems available for forex traders. Market.com offers AutoTrader that comes with numerous features such as live and customizable charts and chart analysis with oscillators, indicators and chart studies. It has the ability to select trades copied from among many strategy providers on its platform. Forex Strategy Automator (FSA) from ForexYard is another automated forex trading platform that is based on different systems that can be filtered on characteristics such as the number of pips, percentage of winning trades, and more. For the most part, the forex market is fast paced where technology can be of considerable help. These systems can be used as a training tool that can eventually assist you with live trading. Make sure to try a number of demo accounts so that you choose the right automated trading system to suit your style of trading. However, consider the need for basic training before you do go ahead and bank on any automated system.