How does Forex Expert Advisor Work?
It is possible to trade Forex both manually and automatically. In the
first case trader analyzes the market situation and searches for
felicitous moments to open trading positions by himself. The second
option means the trader doesn't participate in the trading process. His
only responsibility is to start the trading robot which analyzes the
market and searches for moments to enter it by itself.
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... robot is created by the man, the standard scheme of trading...
A lot of newbies are interested in how the Forex robot works. Traders
wants to know the principals of trading which are used in expert
advisors. And also a lot of traders wonder how safe is such kind of work
and what are the chances of financial risks.
Usually the newbies are fond of trading using the trading robots.
The professionals of the currency market rarely prefer this method of
trading. In most cases, they are engaged in the development and testing
of such scripts and robots.
Thus, the quality of work of any trading robot depends on the
professionalism of its author. Regarding the principles of Forex expert
advisor, it is based on a specific algorithm. As the robot is created by
the man, the standard scheme of trading which consists of the following
steps is in the basis of it:
- Analysis of the market. In order to fulfill it, the technical
indicators integrated to the advisor are used. They analyze the market
situation and give the signals to open positions.
- Opening the orders. It is performed according to the set algorithm.
Positions are opened when the corresponding signals are received from
two or more indicators. Orders are closed when stop-orders (stop loss and take profit) are triggered or when the signal about the upcoming trend reversal is received.
It is worth to understand that the advisor should be set according to your currency pair, deposit and trading period.
Forex advisors work on the basics of already known strategy the choice
of which is determined by the particular software developer. Newbies
should not expect that the trading will be performed according to any
unique tactics. The ready variants of strategies are used for automatic
trading such as scalping or trading on the breakdown.
The advantage of using Forex advisor is that this kind of work allows to
completely exclude the influence of the human factor on the result of
orders.
Trading is performed according to the accurate algorithm. The average
profitability of automated trading programs reaches 100% of the deposit
amount per month.
The disadvantage of trading robots is that the errors occasionally take
place in their work. It is very hard to find such Forex advisor which
would be able to work without high financial risks at least for a year.
It is worth to understand that the advisor should be set according to
your currency pair, deposit and trading period. You can read how to use
Forex advisors in the article “Rules of working with Forex advisors”.