What is Forex?
Forex or more traditionally known as Foreign Exchange or FX, is a global market where all the world’s currencies trade. The Forex market is the largest and most liquid market in the world, far higher than the worlds equity markets (stock markets). With daily volume roughly $6 trillion US a day this leads to many opportunities to trade products. There are various dislocations and patterns in the market which lead to opportunities.
Trading the Forex market with discipline and a strategy can lead to consistent profits. There are many traders out there who are able to do this job for a living. You have all see the “guru forex traders” out there living a millionaires lifestyle. Forex can be the ticket to these riches, just like these guys.
So if you like money, fast cars and women Forex trading could be your the way forward.
This article goes through a technique in of forex trading that I have used to turn $10,000 into $20,000 over the last year. If you are unfamiliar with forex trading you can read more here.
Why use Forex auto trading software for automatic investing
If you have traded before you will know how tiring and difficult trading can be. Especially when your Forex account balance is going backward. Forex traders strive to be disciplined, intelligent, rational and logical. In turn following these core strengths ensure that profitable trades can executed flawlessly and immediately. However, this is not the case as trading is more of a physiological and mental battle than anything else.
If you are looking for a solution to maximise your trading potential then Forex robot trading should be seriously considered.
A wide range of such Forex Robot programs are easily accessible. It goes beyond regular Forex technical analysis software and tools, their primary task is to function without the presence of the Forex trader. By scanning the market for favorable currency pairs, by using preset parameters or parameters designed by the user and then programmed into the system.
In a nutshell, with automated Forex trading software you can turn on your PC, activate the program and then run away while the software is acting instead of you. This is the basic principle behind auto trading.
The purpose of our article is to inform you more about the aspects of automated software (robot forex). The pitfalls to look for from an automated software and ways as to which you can maximize profits. We show you how this done by using the Wallstreet Forex Robot 2.0 Software solution.
Forex Robots and automated trading software for automatic investing - for whom and how does it work
All Forex traders can all benefit from the use of automated trading software and Forex robots can remove the emotion from a trade. In fact, the Forex robots come in a wide range of purchase prices, as well as levels of sophistication to meet different needs. We will use the WallStreet Robot Forex Software for demonstration for this article. It comes in at a reasonable one off payment of $297 for our readers.
There are plenty of online customers reviews for other FX programs which give you a clear picture of the advantages and disadvantages of other programs. Usually, programs offer a free demo period or warranty period to test the robot. I recommend you test vigorously in this period. Most sellers can also offer a free demo to make the user known and attached to the program.
Be aware that most of these trading robots offer marketing incentives to sell there packages sometimes offering extra trading tools. You have to beware of these tactics because at the end of the day no Forex software is going to guarantee successful trading. It still is entirely up to the trader to produce these results.
We feel if you give the WallStreet Forex Robot a go you are getting one of the better products available. Verified results and a great track record are the key things that we like. However, there are important considerations to consider… let's get into that.
Let's see how this type of software actually works. Wallstreet Forex Robot auto trading software is a computer program that analyzes the prices of instruments and other market activities. It works in tandem with Meta Trader 4 (MT4) a trading platform that is available through most Forex brokers. The Wallstreet Forex Robot works with the MT4 system and determines signals, looks at spread discrepancies, trends in price and news that may influence the market, to detect potential favorable trade opportunities. Much the same way a trader would use the MT4 platform to trade, the Forex robot becomes the trader.
The formula and signals that go into the trades are proprietary knowledge. We were not able to change the back end code that goes into the trade but that is fine. We just want to use these signals to make consistent money. We want to operate the way a casino does through consistency.
The advantages of automatic Forex technical analysis software and Forex trading robots
The most important advantage of the forex robot is the removal of emotional and psychological influences in identifying the trade. Automated trading software makes your trade decisions consistent and complete without emotions, using parameters that you have defined in advance or the default setting you have previously installed.
If you have ever traded before you will understand the benefit of taking the emotion out of trading. New and even experienced traders can sometimes trade on the basis of a psychological trigger that fails to meet the logic of market conditions. Which then can result in poor trading returns.
With automated trading different human uncertainties and decisions and judgments do not occur.
In addition, for currency speculators who do not trade on the basis of interest rates, but rather on certain currency spreads, automatic trading has a huge advantage.
This is because price differences are immediately visible, the information is immediately read by the automatic trading system and a trade is immediately executed. This results in flawless and effortless profit!
In addition, other market elements can also trigger buying or selling signals, such as moving average crossovers, chart formations (such as double bottoms or tops or other indicators of support or resistance levels ). In addition, automated Forex software programs can also allow currency traders to manage multiple accounts simultaneously, a real plus that is not readily available for manual operations on a single PC.
The Wallstreet Forex Robot 2.0 utilises the power of its EA (Expert Advisor Signals). The EA is a script written in MQ4 language that contains the script for entering and exiting the trade based on a variety of these signals. As mentioned the script is proprietary knowledge at Wallstreet Forex Robot. It has a major positive expectancy over the long term.
For serious Forex traders who have other interests, professions or commitments, automated software or an automated Forex trading robot can save a considerable amount of time that could otherwise be used to study the markets, analyze different graphs or look at various events that influence currency prices in one way or another.
Automated FX trading systems allow the trader to free himself from the computer screen, while the program scans the market in search of trading opportunities - and subsequently trades when the conditions are right.This implies that the program is constantly working day and night and does not require human supervision.
Excerpt from Wallstreet Forex Robot 2.0
Yes WallStreet Forex Robot 2.0 Evolution can work 24 hours per day from the market opening on Monday to the market closing on Friday. You don't need to monitor you trades. Our EA will do it for you. It will monitor the trades, open and close positions automatically.
The best way to learn automated trading systems is get yourself a copy of the Wallstreet Forex Robot 2.0 and fire up a demo account. There are many practical tips and insights to be found that are suitable for both beginners and advanced learners.
Making the decision for your Forex trading robot
Not all automatic trading software on the internet is guaranteed to make you rich. There are a lot of poor forex robots out there. These robots are either no longer working and/or have not been tested long enough. The most important thing is to get verified back tested results.
Some companies also advertise and claim to have a very high percentage of winning trades. This does not mean long term gains, as some systems have only been traded over a very short time period (ie anything less than 3 years). You have to take the winning percentage with a grain of salt. As proven above with the Wallstreet Forex Robot it has just over 17 years of data for all currency pairs tested, this is what you want to see!
Authentic and verified trade history are the only real way to show the effectiveness of the programs they offer. The golden rule is to understand that the performance of the past is no guarantee for positive future results. However, over a large enough sample you have reduced your risk as the Forex trading robot has performed over many market conditions.
Test, Test and test! Especially in the Demo mode.
Forex auto trader and FX robot - Define your needs
Since automated trading systems vary in speed, performance, programmability and complexity of use, what is good for one Forex trader may not be good for another Forex trader. Some currency traders want a program that generates reports, or, for example, places stops and other specific market orders.
An essential component in an automated system or automated Forex trading robot is the real-time monitoring. Other Forex traders, such as beginners, or less experienced traders, want a simpler program with a set-and-forget function (set and no longer have to look at). Wallstreet Forex Robot sits on the beginner to intermediate user as flexibility is limited.
In addition, the ability to access the FX trader robot remotely is vital if you travel frequently or are away from your PC for a long time. That is why your program must allow access and functionality of any current location via WiFi or other Internet access. A web-based program can be the most useful and practical method to meet the Forex trader and his needs.
It is important to outline that virtual private server hosting, or VPS, is a service that can be considered by the prudent Forex trader. It may be worth setting up or renting a VPN to trade off remotely.
The service, sold by Wallstreet Forex Robot offers extremely quick access, isolates the Forex automated software for security purposes and also offers technical support.
In addition, some companies tend to charge extra fees and commissions. In turn, other companies claim no costs. Commissions and fees can bring your profitability down, so check the terms and conditions contract. It is important to pick a good broker with the lowest possible cost and tightest possible spreads. We will go through that below.
In addition, Wallstreet Forex Robot offers a great no questions asked 60 day guarantee. It is important that all forex robots have this clause as it will give you sufficient time to test. This gives you enough time to test the software on a demo account, find a good broker, test with your account with live funds and see if this is for you. If this is not for you, return the program, and at the very least you have learned what 90% of the population does not know about forex trading.
Choosing your Forex Robot?
Here we will go through the most important part of finding a Forex Robot. We will use the WallStreet Forex Robot as an example in finding your preferred Forex Robot system. Lets assume trading must be treated as a Business. We need to grow our revenues and keep our costs to a minimum to increase our profitability.
Therefore we need to focus on Revenue and Costs. These are the tips I use to ensure you will make consistent returns.
Revenue - Expectancy
Essentially all great forex trading robots work on a principle called Expectancy. If for example you have 1 trading strategy that wins 40% of the time and loses 60% of the time… Is this a bad system...it depends.
Now for a bit of maths! Bear with me...
Let us assume R is equal to the amount you are willing to risk per trade. For this example let R equal to $100, your maximum loss per trade is -R. Now if each winning trade averages out to +3R, in this case $300, and it wins 40% of the time. Your average expectancy is…
3R x 40% + -R x 60% = 0.2 R
So essentially each trade you make with this system, generates an expected value of $20 over the long haul or +0.2 R.
Winning percentage is not everything to be profitable.
Now let's say you have a 90% winning trading strategy, that many Forex Robots out there claim. Lets assume the average winner is 1.1R and average loser is -10R. A bit extreme but you will be surprised how common this is.
1.1R x 90% + -10R x 10% = -0.01 R
No edge - trading strategy is neutral. Surprised?
So how does WallStreet Forex Robot 2.0 Compare?
If we take the 17 year backtest for the GBP/USD pairing
Average Winning trade at $120 at a rate of 85% - Losing trade of -$445 at a rate of 15%
The average expectancy of the system is - 120 x 85% + (-445 x 15%) = +$35
So each trade you place is Expected to earn you $35!
Can you taste your growing revenue stream?Champagne!
Back tested results below:
As you can see here Wallstreet Robot 2.0 - Stop loss and backtested results
For example, the Wallstreet Robot Software above has used the criteria that the user has entered to determine currency pairs that meet the predefined parameters for profitability, and will pass a buy or sell signal. The software can also be programmed so that it automatically opens a position following the signal. In this case it can demonstrate what the backtested results were and how profitable the system.
Costs - Broker Commissions
From the example above we can see that having a positive expectancy is important to ensuring over the long term you will make healthy returns. But what about the costs?
Broker commissions can eat into your bottom line.
Say for example you buy 10,000 of USD against GBP. The market rate (interbank rate) at that time is 1.35. You know for a fact that it will cost you in GBP ~7407 at that rate.
When that rate goes up to 1.36 you make profit of 10,073 US or 73 US - great trade.
Lets just say the broker takes $2 to buy and $2 to sell (ie $4 round trip) - your profit is now $69 - a reduction of 5% of your profits ! In the example above your +$35 US expectancy is actually +$33 US. Not that bad but over 1000 trades that is -$2000 US you are throwing away.
But wait Brokers get you again!
In the example before even though the GBP/USD pairing was trading at 1.35 - your broker will add a spread! This will mean you actually get 1.3544 for example! A little extreme but I have seen it.
Therefore your $10,000 USD costs you 7383.35 GBP. Thats a difference of 24 GBP on the above example.
Now when we go to SELL your $10000 USD at 1.36 you actually end up getting 1.3575, so your return amount is $10,023 USD only +$23USD profit from the trade!
+$23 USD profit with a Bad/Poor Broker - Even though the market should have given me +$73 USD?
I hope you are seeing the importance of choosing your broker wisely and testing to make sure the price your given is the right one.
The best brokers out there should be offering somewhere from 1 to 4 pips from interbank.
In this example we used 30 to 50 pips, it does sound excessive but there are brokers out there who do this practice! Be warned!
Your position to negotiate with brokers will be volume and trade frequency. Always ask for the best deal. It could mean the difference between a Mazda or a Ferrari.
Most Forex trading robots over system checks/breaks to ensure your broker is being honest. Below I have listed the key features of the WallStreet 2.0 Forex Robot:
Broker Spy - Monitoring Brokers Slippage in trades
Profit Protection System - Prevents Flash crashes
Broker Protection - hides stop loss from Broker
High Spread Protection - Reducing the spread
High slippage protection - Protects in high volatility periods
Advanced Money Management - Protection of captial in draw downs.
So you know have a Positive expectancy in your trading system (as shown with the Wallstreet Forex Robot 2.0) and have negotiated a tight spread and low commissions from your broker. Your ready to setup for testing!
Forex software - How to test the MT4 Forex robot and robot trading software
Wallstreet forex robot runs off the MT4 (MetaTrader 4) trading platform. Many Forex trading platforms use Meta Trader 4 to execute there programs. This is a piece of free software which is used by most Forex Brokers.
You can download a copy for free from these brokers with MT4
WallStreet Forex Robot offer an exceptional training program and the FAQ section which will make it easy to setup on the MT4 system. Desk support is available regarding setup, programming, buy-sell criteria and stop losses.
Usually, the majority of the leading companies also offer a free, non-compulsory test of their automated Forex trading robots, so that the potential customer can see if the program is right for them. Test in such a situation that the program can be easily installed and make sure you have no problems understanding and using the program. Also make sure that the software is programmable and flexible so that you can adjust and change predefined default settings to the MT4 Forex robot or Forex auto trader.
Wallstreet Forex Robot offers backtesting support. This is a very important step in verifying your trading results. Testing the claimed results will help you determine whether the claims of the company are in fact positive. I recommend you grab the “Wallstreet Forex Robot” and verify the results.
More points to consider when choosing automated Forex robots
Almost all automatic Forex robot trading software will actually trade the main currency pairs with the highest volume and the most liquidity. These include USD / EUR, USD / GBP, USD / CHF and USD / JPY.
Wallstreet Forex Robot offer 2 products. Wallstreet Robot Pro and Wallstreet Robot Asia. These basically trade different pairs and have different results. If you are in Europe/US - I would recommend staying with Wallstreet Robot Pro. Trading in Japan/Australia you would prefer the ASIA package, this is due to time zone. Trading while your asleep is not advisable as you may be exposed to flash crashes or important news events. If you want outstanding results you can trade both products but you will have risks.
A lot of trading methods will vary from conservative - with programs designed to scalp a few pips into a trade - towards a more adventurous trade strategy with risks. The user decides which approach to use, and the strategy must be able to be adjusted in each direction. Wallstreet forex robot does not hold positions overnight and trades can last a few minutes to hours.
Read the product reviews of other customers that are placed before you purchase, because they are a good source of information about the automated currency trading software.
Price competition is currently beneficial for the consumer, so look around for the best deal, but do not give quality for a lower price. Prices for trade packages can vary from free to thousands of Dollars. WallStreet Forex Robot has an offer at the moment for $297 and includes the PRO, ASIA and Evolution Package.
Forex auto trading software and automatic trading software - conclusion
It does not matter what level of expertise you have in Forex trading. Whether you are a beginner, experienced or an expert trader, automated Forex trading software can help you. There are always potential dangers in trading in every market - and it is the same with software. There are many scams on the internet.
Fraudulent software can be avoided by carrying out the necessary background research and experiences from other traders to each company.
It is essential to understand that no Forex automated software can guarantee a number of winning trades of 100%. However, trading is about expectancy and understanding it can help you generate long term profits.
It is also important to remember that past performance will not guarantee success in the future.
Before you go deeper into it, it is in your interest to learn in a safe, risk-free environment. Take a look at free demo accounts - the easiest way to learn the basics of Forex trading and polish your skills as a currency trader.
Links to Check:
MetaTrader 4 Platform to install
What is a Forex Robot?
What is a Forex robot? How do they work? Firstly we must look at what Forex is and how people round the world have been making a living from using these Forex robots. We will then go into a worked case study with the WallStreet Forex Robot 2.0.
Forex Robot Trading
The solution for the Forex trader!