Disadvantages Of Automated Forex Trading

There is a general perception about Forex trading that it doesn’t bear fruitful results in the long run, however, there is still no solid evidence that can back these claims. What an experienced trader will tell you is that if you resort to several automated means to get assistance with Forex trading, you might as well end up being those users who mumble about the system’s ineffectiveness in the long run, as mentioned in the very first statement. Most of the automated solutions available in the market are basically aimed at providing the users with a curve fitting solution. There are simply no ways to affirm whether any of these methods are reliable or consistent enough to put your hard-earned money on.

automated forex trading

Yes, there are a handful of such solutions that could be profitable in reality, but even they need some sort of tweaking which makes them semi-automated. Now the the profitable part; the manual strategies that do work are devised by human minds, as they are way more radical and practical than any of the automated profit making techniques. Therefore, numerous traders conclude the fact that instead of resorting to a fully automated solution, a semi-automated one is a much better call. There are quite a few traders out there these days that do their businesses relying solely upon manual trading techniques, and require little help from the automated techniques. This, when coupled with better management of money and learning a few tricks of the trading psychology, make up for a far outreaching feasible trading solution that actually pay off rich dividends.

The history of automated Forex trading dates way back to the late 90’s when several web based companies came up with a few Forex platforms that proved to be quite handy tools for providing the traders with instant means to purchase and sell on the Forex spot market. Ever since then, there have been some tweaking and modifications made to the systems, and numerous solutions keep appearing on the global scene at frequent intervals; each claiming to provide you with a reliable and durable solution, which unfortunately, is not the case so far.

The advantages of manual and semi-automated trading strategies aside, it’s the significant cons of a fully-automated setup that can put any good trader astray. In what is to follow, we shall look at some of the major flaws of a full-fledge automated Forex trading system.

As mentioned earlier, computers simply don’t have the thinking capability of a normal human mind; therefore, they cannot devise methods that can be applied according to the dynamically changing situations, with the Forex trading business. The intuition factor cannot be ignored when talking of Forex trading; although some traders might not entirely agree with this fact.

Most trading systems usually work only with the smoother trading systems as well as an uninterrupted run-time of expert advisors. While this can be made quite easier with a dedicated server, things might not be all that simpler if you’re looking to run EA directly from your PC.

Similarly, there are a few types of strategies that are not feasible to be implemented into the real expert advisors. Techniques such as wave analysis or chart pattern are not that easier to code in a contemporary trading program. Provided the AI level that a commercial PC sports these days, it is better off to perform all such complicated tasks manually.

Another problem with automated expert advisors is that they are utterly incapable of handling errors as well as other unexpected events in an appropriate way. This can ultimately lead to some big losses. A big lapse in relying entirely on an automated Forex trading structure is that it is prone to too many scams.

Therefore, it goes without saying that just like all other things that are imperfect in this world, as is the automated mechanism of Forex trading. Although being a hugely popular tool among naïve and experienced Forex traders, the automated Forex trading is also not without its flaws. Therefore, an ideal and safe approach would be to use both the systems wisely to your advantage. As far as using the automated Forex trading solutions is concerned, once they are designed using quality, trusted algorithms, things might well start to look rosy for the future of this mode of business. As of now, your best bet would be just to use these solutions, and make any decisions based largely on your own intuition and experience.

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