The Forex market is one of the most unpredictable and often changing markets. Although, the risk of this kind of trading is high, there are still a lot of people who are risking this kind of investment. There are many experts who offer advice to every newcomer to Forex trading, possibly about using Forex robots, automated trading, or changing trading strategies. How can we separate the right from the myth?
Let’s start with forex robots. What are the common myths about forex robots and how can we correct them?
– Smart and sophisticated forex robots provide the best service
Unfortunately, this is not true. It is the simplest systems that are likely to be the most effective. The benefit of simple systems is that they use only simple algorithms that require fewer elements.
On top of that, vendors will claim that their programs are designed by smart people. Some claim that their programs were created by NASA people or top programmers. How much do these people really know about trading?
– Trading can be improved by science and predictive systems
Yes, Forex trading and automated trading systems use mathematical calculations to understand and analyze trading signals and their trends. But do the mathematical calculations that some programs claim to use really work. Some providers will claim that they use Fibonacci and that it can relatively improve the trading system.
These formulas can help you analyze the market, but it can never be used to predict the outcome of a trade. If it could, then there would be countless people who would be richer for winning in the Forex market.
– Forex robots can eliminate losses
There are some forex robots and automated systems that claim to have zero losses. Again, if this were true, then many users would already be walking millionaires. But this is not the case. About 95% of traders lose money every day. So, the remaining 5% are just the successful ones. How many of this small percentage are using Forex robots? It is normal for everyone to experience periods of loss.
– You can let your forex robot operate on its own
Forex robots claim that you just need to turn on your computer and system and let it operate by itself. It can complete the trade for you without even requiring you to be involved in the process. Any trading system must be executed in a way that can be monitored and still follow the trader’s trading strategy.
The reality is that you can let your device continue to trade, but that doesn’t mean that the more you trade, the more you gain. It still depends on how you make your robot work for what you want and your strategy, not the other way around.
– Success in a demo account is the same as actual trading
Not only because you have proven the effectiveness of the program in a demo account, it may also show the same results in a real account. Everything can be risky. This is why it is important to check the reactions and reviews of the clients about the product. Most Forex robots websites and forums offer discussions about common problems encountered in real accounts and hot spots to solve them.