Forex – Automated Forex Trading

Automated Forex trading systems are pre-programmed strategies that automatically execute trades under the guidance of your personal strategy. It’s an option you’ll find available with most trading software platforms, and to be used effectively it must be configured to your own requirements.

An automated Forex trading system enables you to execute your trades on the Forex market anytime of the day, based on existing technical indicators and custom trading rules that you personally establish. The various features within an automated trading system may include …

Automatic trailing stops
Account equity management
Stop and/or limit orders
Discretionary market orders
Various technical analysis indicators

In addition, an automated Forex trading system will generally support most of the following indicators (the technical support will depend on your platform technology as well as the available features of the system):

WMA – weighted moving average
EMA – exponential moving average
SMA – simple moving average
VMA – variable moving average
TMA – triangular moving average
TSMA – time series moving average
WATR – wilders average true range
VHF – vertical horizontal filter
Standard deviation
Mass index

The two primary reasons for using an automated Forex trading system are to make sure you don’t miss a trade and to help assure that emotions don’t overtake your trading strategy. In case you’re confused, a system is a strategy, software program, or course designed as a guide by Forex trading experts. It’s not the Holy Grail of Forex trading, but a method for evaluating market conditions and currency movements that’s proven successful in the past.

Because of automation, a trader can close a trade within milliseconds, something that’s impossible in manual systems since previous trades are normally closed after several hours. In addition, a trader can trade within varying time zones. In other words, you can place trades or close deals with traders from around the world, even in the middle of the night. Another bonus … short-term data analysis. Traders using an automated system can predict market trends in less than an hour.

For example, take the following scenario: If you’re trading using a manual system, it takes time before a trader confirms if he will or will not accept your deal. He’ll likely analyze the market conditions and the exchange rate of the currencies before making a decision. As a result, the longer a transaction takes, the fewer trades there are in a day.

However, if you’re using an automated Forex trading system, Forex data is updated in real time and the evaluation of exchange rates and market conditions can be done within minutes. Generally, in less than an hour, you’ll be able to decide whether you will go with the deal or not. Therefore, a single trader can realistically place as many as eight trades in regular trading hours (assuming he’s following the day trading schedule).

More trades. Better informed trades. No emotion.

Hard to beat.