Forex Robot
Trading
As a long time and avid trader of the
markets, originally the emini’s and now the Forex markets it has
given me a unique view into how to trade.
I have reached a point whereby studying the
charts, concentrating on a computer screen endlessly no longer
inspires.
A long and hard evaluation of the myriad of
Forex robots, which seem to be the ideal way to go, (if they
work) has eventuated.
What can I tell you?
Do they work,
can they work.
The answer is that surprisingly a large
number of them do to some extent,
with a few that perform in a
good and reliable manner.
What is their secret. Their secret is quite
simple, and can be outlined in a few bulleted terms.
·
Conservative trading style
·
Money management
·
Small consistent profits
·
Realistic stop losses in place.
Let’s elaborate on the points above.
Conservative
trading style- Those few which are worthy of
being called an Automated Forex Trading Robot do not trade
incessantly, in fact most only trade 1 or 2 times a day, and
sometimes will not trade for a few days. They are not looking
for the long haul trending profits. They are looking for the
highest probability of profit. Often this will be in the hours
when the US market primarily is not open. I.e. no news to affect
the market dramatically.
Money
Management
– Control of risk is all important. No more than a
certain percentage of trading capital should be risked, normally
2 to 3 % at maximum. The better robots are well aware of this.
Small consistent
profits with realistic stop losses in place –
The hardest part of entering any trade is where to place the
stop loss. Too tight a Stop loss and normal market activity will
hit it every time.
Too wide a stop loss and the losing trade
will dissipate the gains of the last 2 or 3 profitable trades.
A fine balance here, which is well
controlled by the better robots.
In Summation, Automated Forex Trading
Robots have not solved the universal quest for the risk-free
trade; they have not found the magic formula whereby the money
just flows endlessly.
What they have
formulated in a commendable manner is a balanced and
non-emotional approach to sensible and profitable trading.
