Forex robots store
Forex trading has gained considerable popularity during recent decades. The interest in this field of business was raised due to the development of such technology as Forex robots. These machines turned everything around because of the low input threshold to the Forex. The trading automation by using Forex robots made joining the largest currency trading market in the world possible for everyone. But what are Forex robots and how do they work? Let’s explore those questions and find the answers together!
What is Forex Robot or Expert Advisor?
Forex robot is a system of preprogrammed algorithms and regulations which constitute a specifically developed trading strategy that’s supposed to partially or fully automate Forex trader’s work by examining the market, defining entry and exit points for trades, and executing it for a trader. Usually, it goes as a third-party or self-developed software that is installed on the computer or server. The robot runs with help of trading terminals like MetaTrader4 or MetaTrader5.
It became possible to use Forex EA thanks to the joint effort of professional traders and advanced programmers. So, Forex EA is a computer program configured to execute trades following specified rules of the robot’s strategy.
How does Forex EA work?
The most important task of Forex robots is to execute trading operations as fast as it’s possible keeping the accuracy of their implementation high at the same time. It raises trading effectiveness and economizes a lot of time for those traders who do not do Forex trading as a full-time job.
The principle of operation of Forex trading bots is that it monitors the situation on the market, determines signals of profitable market situations following the program included in it, and submits an application to the Forex broker to complete a transaction, and broker executes the application.
That is, ultimately, the effectiveness of the Forex EA depends on the complexity of the algorithms, indicators, and patterns that are written for it. Thus, it is wrong to rely on the fact that the Forex robot could be turned on and forgotten about, and still will continuously raise profits without trader’s interference. Nevertheless, a well-written and tested Forex robot saves a huge amount of time and lowers the stress that always escorts Forex trading.
There is a number of programs that are supposed to be installed and set up before the beginning of robo trading. The main trading platforms where the EA is installed are terminals like MetaTrader4 or MetaTrader5. These are the main environments for all kinds of Forex trading. Usually, brokers provide fully set-up trading terminals for their customers for free. Otherwise, trading terminals are available for free on the official MetaQuotes website.
Advantages of using Forex EA
There are a bunch of advantages of using the Forex robots that influence most of the aspects of automated trading. These are reasons for such great popularity of Forex robots nowadays which are inherent only for machines, and almost unattainable for humans.
- The first thing that separates Forex robots from humans is their ability to run trades day-and-night with no interruptions. While manual traders are forced to interrupt trading during sleep hours and other necessities of life, Forex robots are made to do their job 24/7 to bring maximum profit.
- Traders must constantly maintain a high concentration, be attentive and focused to reach success in such a risky business like Forex. But since we’re only human, we can be distracted or tired, and all these factors can and definitely will affect trading results. In this sense, a robot also gives a head start to humans because robots don’t get influenced by emotions or other destructed things.
- Statistically, the biggest trading failures happen not due to an incorrectly selected strategy or sudden unpredictable market changes, but due to human factors – greed, passion, inability to stop in time. On other hand, the Forex robot would never succumb to the desire to trade disobeying chosen strategy, which minimizes the risks.
- Only traders with a lot of experience can work simultaneously with several trading instruments or strategies, but this is quite an ordinary task for Forex robots. Using EA traders get in profit on two or three currencies at once which significantly raises trading effectiveness.
- Forex robots can trade due to those technical indicators that may not be mastered yet by the trader. This gives access to the wide field of trading tools which is almost impossible for one person to become a professional at once. This is an incredible feature that makes profitable currency trading available for almost everyone.
Disadvantages of Using Forex EA
There are not only pros of Forex EAs but also cons that must be described so that we can see a full picture of the automated Forex software.
- The real efficiency of EAs’ work directly depends on what algorithm it is guided by. It often happens that a certain algorithm brings a solid profit for a long time, and then, as a result of complicated market action mechanisms, it starts to operate at a loss. Therefore, to make money on Forex, a trader needs not only to know how to install and run a Forex robot but also be attentive to everything that’s happening with your account and if needed to stop the work of the robot to prevent big losses.
- Lack of emotions can be an advantage and disadvantage of Forex EA at once. The EA can drain all your funds in one day without any hesitation. Consider this before purchasing a robot. Choose the advisor that’s got a proper risk control system and money management algorithms programmed into it so that you would not risk with more money than you’re ready to.
- There are tons of Forex robots available out there. The Internet is just teeming with offers of huge income through trading automation. Of course, a major part of these proposals is just a scam. Automated trading has become a fertile ground for fraud because of its highly profitable potential. That’s why it’s extremely important to be careful and double-check any proposition of any kind of automated trading software.
- There is a high probability that your chosen robot shows good results on the historical quotes because it is specifically tested and optimized on historical data. However, good historical performance doesn’t guarantee the same results in real live trading. Real high-quality Forex robot has to be supported with good real live trading results provided by a developer to ensure the trading efficiency of the EA. This is a crucial thing to consider when picking up any Forex robot.
Is it worth buying Forex robots for beginners?
It may feel that automated trading is kind of a golden grail that can provide everyone (even total beginner) with constant profits without any effort from the trader, which is not true at all. Forex robots are just tools that are used by traders to automate some or all the processes of Forex trading but it also takes a lot from the trader.
You need to know the basics of Forex to profitably and continuously trade automatically which surely would save funds from losing. The main things the Forex robot user needs to learn about automated foreign exchange trading are:
- How to begin your work with MetaTrader 4/5 platform.
- How to pick up the right Forex EA.
- How to select a Forex broker.
- Basics of risk management.
Being aware of at least these topics would give you great help in your automated trading. It’ll make it secure, safe, and profitable. So, answering the question if it is worth buying an automated trading system for beginners, yes, it worth it, but you shouldn’t blindly start trading having no knowledge of foreign exchange trading. Take your time to properly choose the system you’d like, test it on a demo, learn the basics, and then starts your trading.
It might also be useful to check out the article about the top 5 trading mistakes beginners should avoid.
Is it worth using free Forex EA?
There are two types of robots: paid and free once, so there is enough controversy among traders about the expediency of using free systems. On one hand, as a rule, quality is equal to payment, so it is better not to spare money, but to purchase a product developed by professionals. On the other hand, some systems among the robots that can be freely downloaded on the Internet may be effective and profitable. And also, some paid systems turn out to be total scams. So, it is a quite complicated task to choose a Forex robot that would be profitable and safe but at the same time would not cost a mind-blowing amount of money.
To successfully cope with such a task, you need to do lots of research work so that you get to know the authoritative automated software sellers and the companies that provide the best Forex robots. Eventually, paid systems that you might purchase would definitely be quality once.
Anyway, we recommend testing any expert advisor on a demo first. It doesn’t matter if it’s a paid or free Forex robot, because every system needs to be examined before you trust your money to the system. This usually helps to see the strengths and weaknesses of the robot and to see if it fits your expectations about profitability and reliability.
Do Forex Robots really work?
To make a long answer short, yes, they are. Since Forex robots developed as computer programs for automation of routine trading currencies processes, good EA does actually do what they’re supposed to do – automate operations of analyzing the market, make calculations, and even trade for traders.
But, if you see Forex robots as cash machines that make a profit while you live your best life just spending the cash and chilling, then you’ve been fooled by those scamming sellers that promise a mountain of gold if you buy their system. It is absolutely not that way.
Forex trading is a job and the Forex robot is just a tool used to reach higher results. You have to know how to get the best out of it. Only proper education and gaining of auto trading experience would bring you success.
So, the Forex market offers a huge quantity of different EAs which are developed to optimize the treader’s performance. But the choice and efficiency of the EA depend on the trader’s qualifications and experience.
When it comes to selecting the system, focus on user reviews, pay special attention to negative but constructive reviews. It will be useful to look at the ratings of the robot and other factors that describe EAs’ performance.
As it’s been said, automated trading systems provide traders with new trading opportunities, giving them an edge over manual traders. They are always ready to execute the algorithms and strategies preprogrammed in it. But when using automated systems for trading currencies, you should not forget that EAs are not perfect, they are not machines for making money, they are just another useful trader’s tools that must be used wisely.