Over the years, Forex trading robots have flooded the market with mixed results. Of course, there are always the good few that work, but unfortunately the majority will eventually fail. In this article, we will look at the possibilities of Trading Robots, also known as Expert Advisors, and find out if it is possible to have a Forex trading system that really works.
The possibilities of trading systems with their limitations
The coding of expert advisors is always progressing, and there is now even software that can read news alerts and adapt this information to a trade. This new wave of programming is cutting edge with the application of basic analytics in trading algorithms; There are problems with this that a basic trader could point out, but it's a conversation for another article. The limitations of a trading system come down to the programmer. There are hundreds of market indicators that give direction to the markets and they will be correct a percentage of the time. The problem is to make sure they are accurate enough of the time to secure a total profit at the end of the week, month or year.
It is common place for a Forex robot to work for a period of time and then undergo poor patches that have the potential to eat up all your profits and even blow up your account. Although these expert advisors are sold with good intentions, there is no way to know exactly how to predict the market, and a rules-based trading system may not fit the market next year, as it did the year before.
A trading system that can adapt
In conclusion, a Forex trading system that really works will be one that can adapt to the trading environment at any time by using more than one set of rules. Using a multi-rules system can adapt to multiple scenarios. For example, a Forex robot that uses a scalping system in a trend market can lose consistently when the market is consolidated. Having a system that could detect the change in the market and switch to a consolidation technique would result in extraordinary results.
There are hundreds of systems on the market, and the best tip we can give to buy one is to look at the past results and pay special attention to the amount. A Forex trading system that really works will have a withdrawal of less than 20% anything more than this, as there is a great danger that you will eventually break your account.