The foreign exchange market, or Forex, is one of the world’s largest markets in terms of both volume and amount of transactions. Forex certainly provides many opportunities to make a significant amount of money and do it fast.
However, there is an equal amount of risk of losing as much and at the same rate. This article aims to introduce you to automated Forex trading to improve your chances of survival and success in this relentless market.
The importance of psychology in Forex
There are many trading strategies that you can adopt or develop to maximize your chances of success and give you a better chance of survival. Regardless of the strategy chosen, psychology plays a crucial role in the success or failure of any Forex trader.
This is the psychological aspect of Forex trading, which most traders find the most difficult part. It is estimated that less than one in ten Forex traders survive to become successful in this market. The main factor in the failure of the vast majority of people who try Forex is the psychological aspects of trading.
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Even those new traders who have followed the recommended steps to get started tend to suffer from thinking. They conducted their study of the basics of Forex trading; they opened a demo account; they tested several strategies; and chose the one that provides the best return. However, even with all the training, when it comes to trading their real money, it’s a whole different story.
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Opening a trade too early, closing too late or vice versa is common for an inexperienced trader. The results? The “perfect” strategy, which worked every time on a demo account, suddenly breaks down, and your capital begins to decline. Of course, this is not a strategy that breaks down; it is the trader’s reaction to the psychological aspects of trading his valuable capital.
Automated Forex Trading
One important aspect of Forex trading is that the process can be automated. It relieves all the pressure from the trader and his too human flaws! Automation transmits transactions into the hands of an expert (EA).
So what is EA? This software, programmed in MQL, is designed to work in conjunction with the Metatrader Forex trading platform. It is deployed by connecting EA to the appropriate trading chart and allowing it to trade according to your strategy.
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The beauty of EA is that it will conduct your trades automatically, without hesitation, as a trader can do. It will follow your strategy without suffering from the psychological aspects of Forex trading, which gives nine unsuccessful traders out of every ten. It will continue to trade 24 hours a day (until markets are open) as long as you keep it online.
EA programming and configuration
You can study MQL yourself to program your expert, or hire a programmer to do it for you. You can find talented programmers at reasonable prices on sites like Fiverr or Upwork.
If you have programmed your EA, it needs to be networked and allowed to work around the clock. Instead of running your computer constantly, consider using a virtual private server (VPS).
A VPS can be located anywhere in the world and allows your EA to operate 24 hours a day for about $ 10 a month. You may even be able to find a broker that offers a free VPS service. Once you get your VPS, log in, install MT4, connect your EA to the appropriate trading chart and start automated trading.
Optimize your trade
No matter how effective your strategy is, you will always have some losing trades. The key to success is optimizing your EA to minimize these losses. To do this, you can use MT4 trade copying programs. These programs copy Forex trades from one MT4 platform to another, and you can set up a program to copy only successful trades.
You will need to install two MT4 platforms, one for your real money account and one for a demo account. The EA runs on a demo account, and the copy program is downloaded to two MT4 platforms. Setting up a copying program just to copy successful (positive) trades will greatly increase your share of successful trades. All your unprofitable trades remain on the demo account – and this is the best place for them!