We bet every novice trader would like to find a “magic wand” that could trade instead of them and do it successfully. And sometimes, some software developers who create Forex trading robots say their products are exactly such a «wand». But how can we be sure that Forex trading robots are really a miraculous tool that allows you to make money out of nowhere?
Let’s figure out what Forex robots are.
Forex trading robots (sometimes they are called advisors) are a result of computer technologies and programming. Without these programs the modern trading in the foreign exchange market seems impossible. Forex advisor is a program that was created to automatically manage the trading process by following instructions and strategies selected by a trader.
So here we got the answer: paid or free, Forex trading robot software does exactly what you tell it to do. It is like a skilled secretary, who strictly obeys their boss’s requests. And in terms of trading activity, a trader is the boss – the one who is in charge when choosing the strategy and responsible for all the risks involved.
The main advantage of using Forex trading robots is that you, for example, do not need to wake up at 3 AM just to check your positions, as your advisor will do it for you. It will automatically close your positions once they hit a desired price. Some advanced Forex trading robots can even shift the strategy, if the market makes major movement while you are away from the trading platform. Also, robots do not have any emotions. They do not panic or hurry, they are above the human factor. They just have to do everything in time and make the most logical and precise decisions.
So, how to use Forex trading robots? There are several ways of how they can come in handy.
First, an inexperienced trader may watch robot’s decision and do some kind of reverse analysis, taking into consideration that Forex trading robot strategies are usually based on the experience of top traders. That is why you may discover some interesting patterns while watching and discussing their moves.
The second way is to use it any time you are not available. This will give you free time and opportunity to react faster to some unexpected market movements. Forex robots make decisions instantly, when human reaction comes with a little delay.
The third and the most reasonable way is to test your own strategies. Set robot parameters manually and check if it works well enough.
Although Forex trading robot software cannot totally substitute a trader, it may be very useful as a tester of your trading ideas and a tireless secretary when you choose to invest a little time on your own.