Forex market is among the most unpredictable and frequently changing market. Although, this kind of trade is high risk, there are still a lot of people who are venturing into this kind of investment. There are a lot of experts who give advice to every newcomer in Forex trading, it can be about using Forex robots, automated trading, or changing trading strategy. How can we separate the right from the myths?
Let’s start with Forex robots. What are the common myths about Forex robots and how can they be corrected?
Clever and complicated Forex robots offer the best service
Unfortunately, this is not true. The most simple systems are the ones that may work best. The good thing about simple systems is that they use just simple algorithms and requires fewer elements.
Aside from that, vendors would claim that their programs were designed by brilliant people. Some would claim that their programs would be created by people in NASA or top programmers. What does these people know about trading, anyway?
Trading can be improved by scientific and predictive systems
Yes, Forex trading and automated trading systems use mathematical calculations to understand and analyze trading signals and their trends. But, are the mathematical calculations some programs claim are really effective. Some vendors would claim that they use Fibonacci and it could relatively improve trading systems.
These formulas could help you analyze the market, but it could never be used to PREDICT the outcome of a trade. If you can, then there would be numerous people who have gone richer because they won in the Forex market.
Forex robots can eliminate loss
There are Forex robots and automated system claiming to have zero losses. Again, if this would be true then a lot of users would already be walking millionaires. But that is not the case. There are about 95 percent of traders who lose their money everyday. So, the remaining 5%are just the successful ones, out of those small percentage, how many are using Forex robots? It is perfectly normal for everybody to encounter a losing period.
You can leave your Forex robots to operate on their own
Forex robots claim that you can just turn on your computer and system and let it operate on its own. It can finish deals for you, without you even participating in the process. Any trading system has to be executed in a way where it can be monitored and still follow the trader’s trading strategy.
The reality is that you can let you equipment continue on trading, but it does not mean that the more trades that you have the more gains you will get. It still depends on how you would make your robot work for what you want and you strategy, not the other way around.
Success in demo accounts is the same for actual trade
Not just because you have proven the effectiveness of the program in a demo account, it could show the same results in the real account. Everything could be risky. This is why it is important to check customer reactions and comments about the products. Most Forex robots website and forum would offer discussions about what are the common problems encountered in real accounts and hot it was resolved.