The average forex trader spends large amounts of time analyzing market data to find trading opportunities. Not only is this time-consuming, it is also error-prone – traders regularly let their emotions override cold logic, spotting false patterns that support their ‘feeling’ of which way the market should move. Often, when they do spot a real pattern, the opportunity has passed – it is difficult for human traders to keep up with everything that is going on in the market and react quickly.
Automated forex trading software can help to address this problem. There are a number of commercially available packages for this, which are designed to monitor the market continuously for profitable trades and then execute them. These programs typically come with preset trading parameters, but also offer users the ability to program their own parameters into the system.
There capabilities of these automated trading packages range from basic to highly sophisticated, with a correspondingly wide range of prices.
There are a number of key advantages to using this sort of automated trading software. First of all, it is completely logical and unemotional. Once the programmed parameters have been met, the software executes the trade no matter what – and it doesn’t execute when the pre-established conditions don’t exist. Second, these systems are able to analyze large amounts of market data in the blink of an eye and then make trades almost instantaneously. Because things such as price discrepancies are spotted right away, the system is able to enter potentially profitable positions as soon as they form. Third, they are able to stay in the market 24 hours a day. This is particularly valuable for serious traders who nonetheless have other commitments – the software will continue to trade even when the human trader is absent.
However, as with human trading, automated forex trading is no guarantee of profits. If you see extravagant claims, such as “90% of trades are winners”, you need to treat these with a high level of skepticism. In fact, you should investigate all the advertising claims made by the software publisher and not take their word for granted. Many good publishers will back up their claims with actual trading history data that is authenticated by a reputable authority. Nonetheless, even if the software does have a proven track record, remember that future results are not guaranteed.
When you are looking for automated forex trading software, make sure that its capabilities are aligned with your needs. For example, some systems lets you set up complicated trading scenarios, whereas others are designed to start trading with minimal setup. Things to look for are support for common currency pairs, the ability to adjust the trading strategy from high risk to conservative, and high levels of technical support. Also make sure that the software can be remotely accessed if you are planning to be absent – in fact, if you are serious about uptime, you may want to have the software hosted in a data center. Also be aware that some companies offer a free evaluation period – take advantage of this as it is an excellent opportunity to see if the software fits your needs.
Automated forex trading software can help to address this problem. There are a number of commercially available packages for this, which are designed to monitor the market continuously for profitable trades and then execute them. These programs typically come with preset trading parameters, but also offer users the ability to program their own parameters into the system.
There capabilities of these automated trading packages range from basic to highly sophisticated, with a correspondingly wide range of prices.
There are a number of key advantages to using this sort of automated trading software. First of all, it is completely logical and unemotional. Once the programmed parameters have been met, the software executes the trade no matter what – and it doesn’t execute when the pre-established conditions don’t exist. Second, these systems are able to analyze large amounts of market data in the blink of an eye and then make trades almost instantaneously. Because things such as price discrepancies are spotted right away, the system is able to enter potentially profitable positions as soon as they form. Third, they are able to stay in the market 24 hours a day. This is particularly valuable for serious traders who nonetheless have other commitments – the software will continue to trade even when the human trader is absent.
However, as with human trading, automated forex trading is no guarantee of profits. If you see extravagant claims, such as “90% of trades are winners”, you need to treat these with a high level of skepticism. In fact, you should investigate all the advertising claims made by the software publisher and not take their word for granted. Many good publishers will back up their claims with actual trading history data that is authenticated by a reputable authority. Nonetheless, even if the software does have a proven track record, remember that future results are not guaranteed.
When you are looking for automated forex trading software, make sure that its capabilities are aligned with your needs. For example, some systems lets you set up complicated trading scenarios, whereas others are designed to start trading with minimal setup. Things to look for are support for common currency pairs, the ability to adjust the trading strategy from high risk to conservative, and high levels of technical support. Also make sure that the software can be remotely accessed if you are planning to be absent – in fact, if you are serious about uptime, you may want to have the software hosted in a data center. Also be aware that some companies offer a free evaluation period – take advantage of this as it is an excellent opportunity to see if the software fits your needs.
Editors’ Picks
EUR/USD holds firm near 1.1850 amid USD weakness
EUR/USD remains strongly bid around 1.1850 in European trading on Monday. The USD/JPY slide-led broad US Dollar weakness helps the pair build on Friday's recovery ahead of the Eurozone Sentix Investor Confidence data for February.
GBP/USD hovers near 1.3600 as UK government crisis weighs on Pound Sterling
GBP/USD moves sideways after registering modest gains in the previous session, trading around 1.3610 during the European hours on Monday. The pair could come under pressure as the Pound Sterling may weaken amid a fresh government crisis in the United Kingdom.
USD/JPY keeps the red below 157.00 on intervention risks
The Japanese Yen sticks to its modest intraday recovery gains against a broadly weaker US Dollar on the back of speculations that authorities will step in to stem weakness in the domestic currency. In fact, Japanese officials stepped up intervention warnings and confirmed close coordination with the US against disorderly FX moves. This, in turn, triggered an intraday USD/JPY turnaround from the 157.65 region, or a two-week top, touched in reaction to Prime Minister Sanae Takaichi's landslide win in Sunday's election.
Editors’ Picks
EUR/USD holds firm near 1.1850 amid USD weakness
EUR/USD remains strongly bid around 1.1850 in European trading on Monday. The USD/JPY slide-led broad US Dollar weakness helps the pair build on Friday's recovery ahead of the Eurozone Sentix Investor Confidence data for February.
USD/JPY keeps the red below 157.00 on intervention risks
The Japanese Yen sticks to its modest intraday recovery gains against a broadly weaker US Dollar on the back of speculations that authorities will step in to stem weakness in the domestic currency. In fact, Japanese officials stepped up intervention warnings and confirmed close coordination with the US against disorderly FX moves. This, in turn, triggered an intraday USD/JPY turnaround from the 157.65 region, or a two-week top, touched in reaction to Prime Minister Sanae Takaichi's landslide win in Sunday's election.
Gold remains supported by China's buying and USD weakness as traders eye US data
Gold struggles to capitalize on its intraday move up and remains below the $5,100 mark heading into the European session amid mixed cues. Data released over the weekend showed that the People's Bank of China extended its buying spree for a 15th month in January. Moreover, dovish US Fed expectations and concerns about the central bank's independence drag the US Dollar lower for the second straight day, providing an additional boost to the non-yielding yellow metal.
Cardano steadies as whale selling caps recovery
Cardano (ADA) steadies at $0.27 at the time of writing on Monday after slipping more than 5% in the previous week. On-chain data indicate a bearish trend, with certain whales offloading ADA. However, the technical outlook suggests bearish momentum is weakening, raising the possibility of a short-term relief rebound if buying interest picks up.
Japanese PM Takaichi nabs unprecedented victory – US data eyed this week
I do not think I would be exaggerating to say that Japanese Prime Minister Sanae Takaichi’s snap general election gamble paid off over the weekend – and then some. This secured the Liberal Democratic Party (LDP) an unprecedented mandate just three months into her tenure.
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