Forex Robots, What are they and what do they do?

Forex trading robots are designed to help traders who want to use automated trading methods to assist with the technical analysis and repetitive elements of forex trading.

A forex robot or automated trading system is a method of trading forex using a computer program. It might also be known as an algorithmic trading system or EA (expert adviser).

Forex robots can automatically trade 24 hours per day and are simple enough to buy over the internet. But do they really work? Can they actually help traders to maximise profits?



They Can Trade 24/7
They Are Not Influenced by Human Emotions
They Can Work Faster and More Effectively
They Can Operate More Complex and Sophisticated Trading Strategies
They Make Backtesting Easier and Faster
Anyone Can Use Them to Get Started With Forex Trading


They Can Trade 24/7

Human traders are usually confined to trading within certain periods of their waking day and will usually have other commitments such as family, work and leisure pursuits. Even the most dedicated forex traders will need to take breaks to eat, drink, sleep and get away from their computer screen.

A forex robot can work continuously with no need for breaks, which means they will be watching and acting on the market at all times, so you never miss an opportunity.

They Are Not Influenced by Human Emotions

Forex robots operate on a set of pre-determined rules and they will stick to this no matter what.

When humans are trading money it can be hard for them to overcome emotions, such as fear and greed, and their own biases and assumptions. This can lead them to hesitate, prevent them from taking trades, push them into making the wrong trades or hold their position for too long.

Even when traders have a firm strategy in place it can be hard for them to think critically and objectively in the heat of the moment. An automated system removes the risk that human emotions can bring to trading.

They Can Work Faster and More Effectively

A forex robot can scan the markets, find opportunities based on pre-determined parameters and carry out trades according to its rules, all in a matter of seconds. A human trader doing this manually is likely to take much longer and may miss opportunities, or waste time making decisions or entering an order.

They Can Operate More Complex and Sophisticated Trading Strategies

Robots are much better at multi-tasking than humans, so using an automated system allows traders to have multiple conditions for things like entries and exits, stop-loss orders and profit targets, all operating simultaneously. Forex robots can also monitor multiple currency pairs at the same time.

They Make Backtesting Easier and Faster

Backtesting is the process of testing out possible trading strategies against historical data and using this data to optimise a chosen strategy. Done manually, it is complex and time-consuming.

However, forex robots can download, store and analyse large amounts of historical data, allowing traders to measure the effectiveness of different strategies before applying them to the live market.

Anyone Can Use Them to Get Started With Forex Trading

The easy availability of forex robots means you do not have to be an expert to get one up and running on your computer and start trading forex.

However, you should always thoroughly research any automated trading system that you are considering buying and try it out on a demo account before moving onto the live market. But using a forex robot can help you to dip your toe in the water, while freeing up your time to study forex and trading in more depth.