Automated Forex Trading System: Faster Execution Means Increased Trade Volumes. Helpful Facts to Keep in Mind
The concept of automated Forex trading system is mind-catching.
Before the automation of the Forex market, exchange-traded futures market was the initial to switch on automation. Then, the traders on the Interbank spot FX market decided to catch up with the most modern trend and moved too to the new system.
Automated Forex trading system enables traders to perform their trade on spot Forex market automatically and anytime of the day, based on existing technical indicators and custom trading rules. There are a range of features included in the automated trading system, such as:
• Automatic trailing stops particularly if the trader is losing in a particular trade position;
• Account equity management;
• Stop and/or limit orders;
• Discretionary market orders; and
• Various technical analysis indicators within your discretion for enabling trend-following systems.
Automated Forex trading systems supports most of the following indicators (the technical support will be dependent on the technology used as well as the accessible features of the system):
• WMA (weighted moving average);
• EMA (exponential moving average);
• SMA (simple moving average);
• VMA (variable moving average);
• TMA (triangular moving average);
• TSMA (time series moving average);
• WATR (wilder’s average true range);
• VHF (vertical horizontal filter);
• Standard deviation;
• Trailing stops;
• Mass index;
• Fixed limits and stops, and others.
The triumph of the automation process to the Forex market is attributed to a number of factors, for example the subsequent:
• Its ability to perform or perform trades in actual time. Because of the automation, a trader can close trades within a few milliseconds. It is impossible in manual systems, as previous trades are in general closed after several hours. Besides, there are as well instances where a trader incurs several losses in a row that prevents him from making any fresh transactions. Accordingly, with automated Forex trading system, this problem could be avoided.
• Its ability to greater diversification. With automated trading system now in place, a trader can trade in different local as well as international markets in varying time zones. In other words, you can place trade or close deals with various traders from a range of markets around the world even in the middle of the night.
• Its ability to analyze short-term data. This feature is not obtainable in manual trading system. Accordingly, traders using automated system have the larger advantage in view of the fact that they can predict market trends in less than an hour.
If you will consolidate the features and the benefits of automated Forex trading system, it will give you a solid conclusion: with the Forex market on automation, you will be able to place more trades on a single day, consequently increasing the average volume trades each day.
To further explain the conclusion. Let us take the subsequent situation: If you are trading using the manual system, you will see that it takes time before a trader confirms if he will allow your deal or not. He will look on the market situation firstly plus the exchange rate of the currencies that you are trading with. As a result, if it takes time before a transaction will be finalized; there would be fewer trade volumes.
Now, if you are using the automated Forex trading system, the estimation of exchange rates and market conditions could be done within some minutes, in view of the fact that Forex data are now updated in real time. Most likely after less than an hour, you will be able to take your position whether you will push through the deal or not. If a Forex deal per trader is averaging in an hour, a single trader can place as much as 8 trades within the regular trading hours (if he is following the day trading schedule) and additional trades beyond the regular trading hours. There are thousands of traders in just a single market who can place such standard number of trade per day. Combining it with the number of Forex markets around the world, the figure is just huge enough.
Also, the technology is changing continuously, consequently there is a trend that the average number of trades per day will boost, thus a possibility of increased trade volumes on daily basis. With faster trade execution, that is a certain possibility.
Be appreciative, the Forex market is now at the helm of automation. Transactions are now faster, and earning money through Forex trading is now easier.
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