Forex trading software is becoming more and more popular lately. There are two types of software. One I call auxiliary software that is simple indicators and more sophisticated buy-sell signal generators based on the indicators or price action. The second kind of trading software called automated traders or Expert Advisors. This piece of software that is based on some trading strategy actually opens a trade instead of a trader. I would like to discuss in detail each kind of the trading software and see if a trader can rely on them in his trading.
1. Auxiliary trading software
The software that helps to identify a trading opportunity has been here long time ago. Simple software can plot the moving averages or more complicated indicators. Those that generate signals using the indicators are intended to simplify the process of analyzing the data of the price charts. Unfortunately most people use this software to generate the signals to enter the market and don't really study the market and test their strategies. It is a good tool but if a trader continues to lose money in the market a tool will not change the situation for him over night.
2.Automated Trader software
Another type of trading software is the one that opens a trade without a human interaction. At first it seams that it's a perfect solution. Since machine doesn't have any human emotions such as fear and greed it's not susceptible to a trading error due to human emotions.
But there is an interesting thing can happen if you give such software to an experienced trader and to a new trader. An experienced trader will test the software apply it and get consistent profit. Whereas a new trader will attempt to run it continuously hoping that the software will make him a profit.
What he doesn't realize is that any such software is based on some sort of trading strategy. There is no trading strategy that fits any market condition. For example a strategy that works in ranging market will fail in strongly trending market. That's why many automated trading software give very good results in the beginning. They were developed for the current market condition. Only a human can spot the change in market and switch off the software. When those conditions are back he will run the software again. That what experienced profitable trader would do. But most people run it continuously hoping it will make them rich quickly and it make them lose money quickly.
Those tools can be quite useful but a trader has to study the market first and practice his trading skills. After he develops a feel for the market those tools can really propel him to success.
Albert Schmidt is a part-time currency trader. After quite a long time of struggle he learned to make consistent profit trading in Forex. Review a trading strategy he successfully uses in his trades. |
1 comment:
Forex Trendy is an innovative software capable of determining the safest continuation chart patterns. It scans through all the charts, on all time frames and analyzes every possible breakout.
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