Forex trading is a very interesting adventure and the earlier you venture into it the better for you. Forex trading is interesting. You can also make a lot of money from trading. While it is possible to make money by trading Forex, you must know that it has challenges. You must also understand the challenges so that you will not end up making wrong trading decisions. Anyone can trade Forex, but you must make sure that you have adequate knowledge. However, you do not need to have deep knowledge before you can trade Forex. Instead of learning about how to trade, you can simply go for Forex trading robots.
These robots can help you to generate profit from Forex trading without you having any knowledge. Anybody can use robots to generate easy profit. In the remaining part of this write-up, we will show you some of the pros and cons of using Forex robots.
Advantages of Forex Trading Robots
One of the benefits of using Forex trading robots is that it enables you to trade Forex at any time of the day or night. The robot will trade for you. It will always be there to trade even when you do not have the time to trade. As a human, there is a limit to how long you can spend on trading. The robot never gets tired; it continues trading for you for as long as you want. The robot will take up the trading activity, while you can spend time with your friends and loved ones.
You will surely need a break to do other things. This means that you can miss out on trading opportunities. The robot will never miss such opportunities. So, it can make trading a lot more profitable for you. Staring at your computer screen for a long time is also not good for your health. So, you are better off with the robot.
No human emotion
Emotion is the reason why many Forex traders fail. If you use a trading robot, you will not be involved in making trading decisions. So, your emotion will never feature in your trading decision. Forex trading robots make trading decisions based on pre-set rules. They will always stick to those rules irrespective of the market condition or situation. Emotions will come in when you trade with real money. It may cause you to exit a trade too early or too late. This is ever the case when you use Forex robots. You will never make wrong trading decisions or hold trading positions for too long. If the robot is good, you can depend on it to trade for you.
Critical thinking can even be difficult once it involves real money. Trading by yourself can expose your funds to risks. Robots will help to put an end to such risks for you. There will be no emotion at all when you trade with a robot. Such robots will make trading very easy for you. It can even make it easier for you to make more profit from Forex trading.
Faster trading speed with Forex Trading Robots
The speed at which Forex trading robots work is impressive. They can even generate profit faster. Additionally, robots can place trades fast and they can also help to close trades very fast. This, therefore, remove the need for you to get involved in trading. Additionally, the trades from the robots improve the effectiveness of your trading. It will scan the market very fast. Its speed is always faster than how a human will do it. It can also check multiple timeframes quickly.
A human can need 100 fold of the time a robot spends to scan the market. It will quickly place a trade in line with the pre-set rules and close the trades as and when due. Trading manually can require a lot of time. You will find yourself also missing out on some trading opportunities. A robot will never miss such opportunities at all.
Disadvantages of using Forex robots for trading
Forex robots have so many benefits but they also have disadvantages. You need to understand the disadvantages before you start using robots for trading Forex.
A poor internet connection can spoil the fun
Forex trading robots can ease the process of trading a lot. However, things can go south if you are bedeviled by poor internet connectivity. You need a very good computer to run a robot. Your internet connectivity must also be reliable. If there is any delay or obstruction on the internet, it can negatively affect your trading account. Poor internet connectivity can compel the robot to make mistakes in trading. Aside from the poor internet, hackers can also attack the robot. Computer viruses are also culpable.
No human imagination or thought
Someone using manual trading can use his knowledge to decide if a particular trade will go well or not. Forex trading robots do not work that way. The sudden news release can render the trade from a robot unprofitable. Someone using manual trading will know about such things and will use his knowledge of fundamental analysis to open or close a trade. These things are lacking in a robot.
If the manual trader has full control over his emotion, he can perform better than a Forex robot. The manual trader can bring is professional observation, analytical thinking, and research knowledge to bear in the trading. This can improve the trading outcomes for sure. You cannot expect a robot to do all those things.
Unreliable for fundamental analysis
Forex trading robots can only trade using technical analysis. They become useless when it comes to fundamental analysis trading. The robots can only read price charts and market statistics to make trading decisions. Fundamental analysis is too advanced for them. This is one of the many areas where the manual trader stands a head taller.
Fundamental analysis has to do with evaluation via external circumstances. Good examples of the external circumstances and events are:
- Industry trend
- Political events
- Economic events
These three factors can determine price movement a great deal. It is, however, unfortunate that a Forex robot never takes such things into account. This can lead to a series of losses for the trader. A human trader can keep an eye out for those events that can affect market movement. A robot is unable to do such a thing. A manual trader can notice a quick reverse in the market due to fundamental influences. You can never find a robot that can do this (at least, not yet).
Not good in non-trending markets
Most Forex trading robots work according to the market trend. This means that robots can become useful once there is no adequate trend in the market. This means that robots will most likely bring you heavy losses if it is a sideways or a choppy market. The effectiveness of the robot can fall drastically if there is no trend and the market is moving sideways.
They are usually scalpers
Many of the Forex trading robots around the only scalp the Forex market to make a profit. As a result of this, they will not stay long in the market. The robots are, therefore, unable to take advantage of a long trend. The robots will only hold positions for a few minutes most of the time. They only seek to generate small profits and accumulate profit over time. There may be some other robots that are not scalpers, but they are not many out there.