Forex Manual Blog

Newbie asked:


I am new to the forex market and am looking for a good trading system that actually works. Can someone point me in the right direction please?

BARDIN

Lawrence Efenure asked:


Self-directed forex trading is to automated forex trading as manual data processing

is to electronic data processing during the wake of the advent of computer

applications for business use.



Automated forex trading introduces many advantages not attainable with self-directed

trading. With automated forex trading, a forex trader is able to put his or her forex trading business on auto-pilot. What this means is that the forex trader has more time for leisure or other human endeavours while the business runs

itself. He or she is able to sleep well, go on vacation, spend time with kids, and just be plain relaxed with life while earning auto profit. More importantly, the forex trader is able to avoid the work load of constantly carrying out complex market analysis and decision making that he or she requires to stay successful trading the forex. There is virtually no learning curve in using automated forex trading systems.

The question most people will ask next is whether self-directed trading will soon face natural extinction or be phased out. If not, why not? Every good thing, they say, has a downside. So, what is the downside for automated forex trading? Most, if not all, automated trading systems are based solely on technical analysis. This leaves

much to be desired as price movement is driven by fundamental factors. A well educated and experienced self-directed forex trader can make more efficient trading decisions as opposed to an automated forex trading system that is based solely on technical analysis. This is� because, he or she can react more quickly to news effects even before they show up on the charts. As a result, you find that most automated trading systems have low equity growth curves compared to what is attainable with professional self-directed forex trading.It seems a good idea for

businesses to invest more on self-directed trading than automated trading systems. A company can hire a few experienced professional forex traders to run on a shift basis say 3 shifts of 8 hours each to cover the 24-hour timeframe. These professional traders can then be responsible for directing other ordinary-class traders on what to do via live chat or some other cheap and fast means such as an electronic bulletin board or mailing list.

This way, the advantages of self-directed trading can be leveraged and the full potential of a forex trading business realized. Nevertheless, for an individual forex trader, automated forex trading would be the best bet given the advantages of savings in time, money and effort.

In conclusion, we see that in as much as computers cannot be used to completely automate everything that humans do, automated trading cannot completely phase out self-directed forex trading.



MUFFLEY

Sam Beatson asked:


Creating a forex trading system that works is a task some people assign to a divine entity who magically manifests itself as a marketer selling the latest “holy grail” forex trading system. When it comes to an automatic 20 pip forex trading system, the search is likely to be long and arduous, because of the old adage “if he’s doing it, why isn’t everyone doing it”.

In fact, I don’t believe there can be an automatic 20 pip forex trading system because there is always the element of the forex market which is totally unpredictable.

It’s not irregular for a forex analysts whose automatic 20 pip forex trading system is based entirely on his fundamental and technical analysis has to come back the following day and explain an unexpected reversal due to fundamental (socio-economic) news being announced lower or higher than expected resulting.

Another example of why this may happen in these times is a decision made about the war in Iraq for example that has resulted in emotional buying or selling of the USD for instance and therefore rendering the automatic 20 pip forex system another forex loser for the day at least.

So, if fundamental analysis can not be predicted, and as one author puts it “no one knows whats going to happen” in the forex market, how can an automatic 20 pip forex trading system be created?

The answer lies in the understanding of the word “automatic” If you truly want an automated automatic 20 pip forex trading system, you are going to be hard pushed. This is because there are going to have to be rules, such as not trading in the vicinity of newstime where the market reaction can be unpredicatable based on technical indicators due to the reaction of the market to the news as opposed more than predetermined technical levels which tend to get overidden particularly during major announcement such as the non-farm payroll data once per month.

However, you could call a manual trading strategy which makes a fairly consistent 20 points an automatic 20 pip trading system, but there has to be a footnote really, and that footnote must include various rules about the automatic 20 pip trading strategy as to when and how the system can and should be used exactly. The system itself is automatic in the way it roduces buy and sell signals, but, due to the nature of the forex market, it must be traded manually in reality using intuition and skill to not trade during false signals.

If you decided you were going to create the makings of an automatic 20 pip trading strategy, you cannot call it that immediately, because at first it sometimes will be good only for 10-15 pips rather than the full 20. At other times, it may give you automatic signals which tell you to get into a trade which goes for 50, 70 or even 100 pips at a time, which for an intraday forex trading system would be borderline outstanding considering the market may move in a range of only 120-150 pips on a reasonable trading day,

For an automatic 20 pips forex trading system then, one must know the online currency market fairly well. One must have education and mentoring and at least training in some indicators and strategies to understand the reading of the market technically, as well as a sound understanding of the fundamental analysis aspects of the forex market.

For myself, the automatic 20 pip forex trading system I utilise contains a good deal of classic trading rules, fibonacci retracement zones are mapped in, moving averages abound and there is use also of momentum and strength of the market indicators with as much lag reduction as I have found possible with fairly foolproof fail-saftey measures to reduce false signals to an absolute minimum.

Contrast that with a trader I spoke to today and I was flabbergasted to hear together we brainstorm from being technicals-crazy to having an automatic 20 point trading system that gives at least 2 signals per day across three currency pairs (a total 40 points daily target for the system) using only 3 lines on-chart and absolutely nothing offchart - not even a care about news (fundamentals) particularly because it ‘does his head in’. So, just as the fat lady sings when its all over, so expect that anything may be possible.

A system is automatic in that it one to be confident to enter trades. A forex strategy is manual in that it is the forex trader who pulls the trigger on a trade. Its automatic though in terms of generating the entry signal based on the lining up of a few indicators on the chart and off the chart. Rules include the times of trading being particular market hours and avoidance of important announcements is key.

This article concludes that it is possible to create an automatic 20 pip forex trading system, but it takes a lot of trial and error to create an automatic 20 pip forex trading system that does not generate a whole bunch of false entry signals and actually captures trades that go the 20 pip distance.



WHITTLESEY

Venu Modalavalasa asked:


Many automated forex trading systems say that there is no need to have any experience if you trade with automated forex trading systems. Because the automated forex trading systems will automatically place orders for you with out any human intervention. Is this really so?

But this is absolutely wrong. Until and unless you have some trading experience and some knowledge on forex trading you can’t make profits with forex trading systems.

To make consistent profits with automated forex trading systems, you need know the various forex trading strategies. Forex trading strategies are very important whether you trade forex manually or you trade with automated forex trading systems. There are many strategies while trading forex. But all those strategies won’t be useful while you trade with automated forex trading systems. There only a few which can be used while you trade with forex system software.

Before having your own automated forex system, take a good forex course. In internet there are lots of e-books and e-courses are available. Buy a good one and put that for your reference for your life time. There is another best way to learn! If any of you friends are already in forex trading then learn from them. They will tell you all the insider secrets and also the mistakes that often many people do. This is something like live training for you. If there is no one for you to teach forex trading like that, then better go for good forex e-book or a forex e-course. Generally, do not go for free e-course. They will make you learn the basics and some terminology but never tell you the insider secrets or the forex strategies.

After having your e-course, now pick up the various forex strategies that you have learnt. Now get a best automated forex trading system and put it on demo mode and test it with various forex strategies that you have learnt. Now filter out the strategies those does not work with your automated forex trading system. Now you will be left with some strategies that work with your forex trading system software. By doing this you will have better hands on your automated forex trading system and you also know which strategy works well with your forex system software. Now with this you are ready to trade with real accounts.

I summarize that, if you really want to trade with automated forex trading system and make consistent profits, prepare well and learn the strategies. Forex strategies are very important whether you trade manually or you trade with automated forex system software. To make consistent profits with forex trading system, a forex strategy is very necessary. Do not believe the captions that “no prior forex trading experience is needed if you have an automated forex trading system!” Prior forex trading experience is needed! Click Here to get instant access to the best Automated Forex Trading System!

Click Here to get instant access to the best Automated Forex Trading System!



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