Although it is highly recommended that you learn to trade yourself, trading, especially for beginners, can be highly confusing. Most times, rookie traders, except for beginner’s luck sometimes, usually experience more losses than wins.
This is usually demoralising for them, ultimately leading to their exit from the business. As a result, it is advisable that they augment their burgeoning trading skills with a sound automated Forex signal service. First, what are Forex signals? What are the automated ones? How can you find the best? These are some of the questions we will answer in this guide.
Forex signals are messages communicated to traders in the form of emails, SMS, and other means to guide them to make accurate trading decisions. They usually come in the form of alerts for their subscribers, notifying them of what currency pair to trade and the specific prices at which to buy or sell.
The use of Forex signals has grown in popularity in recent years for many reasons. First, to a reasonable extent, they have proved to be effective for many traders. Also, they have helped many not only to kick-start their trading career but also to make them into profitable traders.
However, Forex signals have also come under many criticisms. Additionally, they have become a channel through which scammers prey on undiscerning clients. Hence, you should be informed before you take a dive into the Forex signal world. This guide will teach you what you need to about it.
Types of Forex Signals
There are many criteria for the categorisation of Forex signals. There are types based on the method by which those signals are deduced. In this regard, Forex signals can be either fundamental or technical. Fundamental signals are derived from economic events and information such as financial news, geopolitical events, and overall market updates.
On the other hand, technical signals are founded on the technical analyses of currencies using tools such as Japanese candlestick charts, Fibonacci retracements, and technical indicators. They also usually include risk and money management recommendations such as stop-loss (SL) and take-profit (TP). It is important to state that most signals circulated around are technical in nature.
Besides, there is the categorisation of Forex signals on the basis of their originators, that is, whether they are of human or algorithmic origin. Human analysts at many financial institutions and news portals also have trade recommendations which they often choose to offer to the public as Forex signals.
On the other hand, the algorithmic Forex signals, also known as automated signals, are becoming increasingly widely used among traders as a result of their simplicity and ease of generation. These signals, generated by computer algorithms, are made available to their subscribers in real-time.
Advantages of Using Automated Forex Signals
Automated Forex signals are becoming more widely used, and for good reasons. Those reasons, overall, help the Forex trader who use them to save time, minimise risk, and increase their trading returns. Here are some benefits for which you should consider subscribing to an automated Forex signal service, too.
- Time-saving: Automated Forex signals save time. By eliminating the time you would normally dedicate to analysing the market, they free up time to do other things. And since they are automated, you do not need to be placing trades yourself all the time.
- Risk diversification: You can choose to subscribe to different automated signals providers based on differing risk tolerance profiles. This enables you to effectively diversify your risk.
- Increased efficiency: Automated Forex signals will enable you to identify more and higher-probability trading opportunities. With this advantage, you can be sure to increase your gains.
- Reduced fees: The benefits of using this type of Forex signal service still come at an affordable cost. That is, you pay less and earn more.
- Account control and ownership are not affected: At some point, you might start thinking that your automated Forex signal provider can take over your account. However, that is not true. No matter how long you use this type of signals, you will always be able to retain the control and ownership of your account.
- Community: Commitment to automated signals can be a little bit lonely, if not for the community structure that most of their providers arrange. Consequently, there will always be a community to share your social trading sojourn with.
The Best Automated Forex Signal Service Provider
Certainly, you can obtain automated Forex signals from many sources. The internet is replete with promotions of different companies that offer them. However, it is important you ensure that you get the best among them that will earn your trust.
Also, the price of the signals is another consideration to make. While many are free, there are the premium ones that require subscription charges. No matter the one you settle for, what is important is that it has a good success rate and it provides evidence for its sterling performance.
The MetaTrader 4 and 5 trading platforms have an integrated automated Forex signal service. It is the MQL 5. The signal service providers available on it are either free or require paid subscriptions. The signals are directly executed on your trading account, making the whole process efficient.
Here is the most popular automated Forex signal service in the industry. ZuluTrade works on the principle of social trading. Hence, you will be able to copy the trades of profitable traders. The platform currently has over 10,000 signal-providing traders within its network, meaning that you will be given many choices to pick from.
To use ZuluTrade, you do not need any entry costs, except a sound policy for managing your funds. Finally, it is important you note that notwithstanding the one you decide to use, you can also benefit from the third-party verified Forex signals of 1000pip Builder.
By now, you would have fully understood what automated Forex signals are, their benefits, and the best of their providers from which you can consider choosing one. 1000pip Builder should be your number one choice for verified Forex trading signals of any kind.
Finally, you should note that using any type of Forex signal service should not be taken as an ultimate replacement for learning to actually trade. That is, automated Forex signals should not hold you back from taking trading courses, reading books on Forex, and learning the art yourself.