Forex Robot – Does It Actually Works Or Is It Just A Scam? – Guest Post
If you have researched a little bit about foreign exchange trading (forex), you should know that there is something which is called a trading robot. Trading robots are also known as trading software and auto trading. They analyze the situation in the market based on the programming done. They execute the trades automatically on your behalf. You just have to buy the software and use it, and it will make money for you. It’s as simple as that; at least in theory. But do they work in reality and make money?
Edge of the Computer
There are few things which are good about the inclusion of the computers. Computers have no emotions. So there will be no emotional elements and perceptions in analyzing the markets. Emotion is one of the reasons for the failure of the most traders. If the last trade is a loser, computer will have no emotional impact on the next decision process. These are the things which any trader should work upon. Emotional detachment is the best quality which every successful trader has.
Inability of Trading Robots
Despite these advantages, trading robots don’t work. Short term trends in the markets are a result of the collective emotions of the market participants. The price is nothing but an emotional outcome of the traders. There will be a logical gap if you place trades based on the pre-programmed software. You must have a human involved in the decision making. Markets may change the perception within minutes. Computers may not be in a position to handle such volatility. As a human you may decide to trade or sit on the sideline. There are some limitations of computers. Trading robots at best may work sometimes. But it will not work all the time. The success of trading depends on the consistency.
The Discretionary Element of Trading
There is a discretionary element involved in the decision making. Based on the pre-programmed software may be able to identify a pattern which can be traded. But the set up may not be of the high quality. Software can not differentiate between the high probability set up and the one which is of inferior quality. There has to be a human mind involved in the decision making.
A Common Sense Approach
Simple common sense will answer whether trading robots work. With trading robots, one should be able to literally print money at will. If the inventor of the trading robots is so sure about the results of auto trading, why is he selling it for few hundred dollars given that he can make millions using the same robot? Making money in any business requires a lot of hard work. If you are thinking of making money with the help of robots, you are just being naïve.
Trading robots is a fascinating idea. But it doesn’t work. It is nothing but an illusion. You should not fell into the trap of trading robots. Instead spend the same money in learning forex trading basics. If there’s anything you can learn from trading robots, it is keeping emotions out of every trading decision. If you can do that, you don’t need any kind of software to make money. With practice and patience, you will soon make money at will.
This is a guest post by Matthew Johnson, who writes for FXbuild.com where he shares tips, strategies, and reviews to help traders improving themselves. Visit his site at .