Significance of Forex Trading Signals in Trading Currency

ByLe Dang Thao

Expert Author Le Dang Thao

Manual or automated

Manual system for forex trading signals refer to the trading individual who makes the decision to buy or sell currency based on his interpreted signals from his own trading screens. Automated system for trading signals refers to the trading individual who provides instruction to automated software what exactly to search for and how to interpret data.

Sources of forex trading signals

Majority of forex brokers including third party contracts are providers of signal alert services. Forex signal service has no charge if trade is with an actual account or a demo account. There is a monthly payment required from non-trading patrons or signal service from a third party source. Signal service may be sent through e-mail or text service through a mobile phone. It can also be obtained from the broker's site online. In view of the fact these signals are provided by traders, they are mostly more exact as compared to automated forex signal software, but neither is one hundred percent accurate.

Forex robots

Forex robots are software that can automatically determine entry/exit points for primary currency pairs. Developers typically show in their marketing ads copies of trading blotters or documents presenting hundreds of the smallest moves in currency obtained in a matter of days or weeks. Software is reasonably priced between a hundred to two hundred dollars per package. These packages may be downloaded and inclusive of money back guarantee between thirty up to ninety days. Forex robots are supposed to be installed as extension of the traders' forex platform. The trader can simply watch as he works out strategies or do other tasks while forex robots make him gain profits. However, that may be too good to be true.

Accuracy of signals

The foreign exchange market is limited in comparison to the amount of currency pairs from which reasonably accurate signals come from. EUR/USD, USD/CHF, USD/JPY, and GBP/USD are the currency pairs where majority of highly developed signals come from. Apparently, there is no totally accurate signal. A notable optional extra to a signal is the trader's experience.

On the whole, Forex trading signals involve systematic kind of trading as effective means to invest when the trader carries out decisions based on recognized criteria. Market panic does not affect the systematic investor. In effect, he does not make varying daily decisions. This takes away other factors which eventually can annihilate a significant proportion of main trader accounts.

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