Auto trading on Forex

The concept of auto trading begins to interest most novice traders after several unsuccessful attempts at independent trading.

Automatic forex trading is trading using mechanical systems, special programs or trader terminals that completely automate the process of opening transactions, from technical analysis to opening and closing transactions.

At the moment, this type of trading is carried out using two options - advisors for automatic trading or special terminals in which it is possible to configure the receipt of signals to open transactions.

 

In practice, trading with advisors has become most widespread, since these scripts can be installed in a trader’s standard terminal and there is a large selection of similar programs, including free ones. Unlike advisors, specialized terminals are almost always paid, and sometimes you also need to pay for the supply of signals.

Auto trading with advisors has its advantages and disadvantages, we will talk about them below.

Pros of Auto Trading.

1. Fully automatic trading - the trader’s participation is only necessary when installing and configuring the script, after which the program independently analyzes the market, draws appropriate conclusions and opens orders.

If certain conditions are met, the transaction is closed with a profit or a stop loss order is triggered; especially smart advisors can even set its parameters independently. Thanks to this, the trader has a lot of free time, which he can spend at his own discretion.

2. Does not require special knowledge - usually the installation and configuration of the advisor is fully described in the instructions attached to it, so for auto trading it is not at all necessary to have a perfect knowledge of technical or fundamental analysis; basic knowledge of Forex is quite enough.

Disadvantages of auto trading.

1. Additional costs - most often, more or less decent programs for automatic trading cost money, and their price starts from 500 US dollars, which is far from affordable for a novice trader.

2. Risk – like any program, the Forex advisor may malfunction in its operation, or may not correctly assess the situation on the market.

But if you simply experience discomfort when making errors in a regular program, then every error costs money. 3. Special conditions - some of the programs require a certain amount of deposit to trade, others trade only overnight, others only trade in certain currency pairs.

Additional conditions do not always coincide with the desires and capabilities of the trader, which creates some difficulties when using the robot. 4. Restrictions of brokers - more than half of brokerage companies do not allow the use of auto trading on their servers, and severely punish raiders who violate this condition.

In my opinion, the popularity of auto trading is more due to the advertising of easy money on Forex than the real effectiveness of this type of trading. Therefore, before making a choice in favor of this type of trading, you should think carefully.