What Are Forex Signals And How To Identify Profitable Ones
The basic definition of forex signals is, “a software or service designed to broadcast buy/sell recommendations to a subscriber base”. However, there are many aspects of signals for forex that need to be considered. I will attempt to cover all of the aspects of forex signal trading and conclude with recommendations on how to know if you have found a good forex signal provider.
The original trading signals were simply buy/sell recommendations sent via email or sms text messaging that listed an entry price, along with recommended take profit and stop loss levels. Some forex signal providers are still providing this type of service, and it can still have merit if the system is designed to hold trades for a minimum of several hours, or preferably several days or even weeks. These services are limited in that they will not work for intraday trading, as price often moves too quickly to send out recommendations quickly enough, plus it requires that the subscribers constantly be near a computer and ready to execute recommendations on their trading platform.
It is only recently that auto trade signals became readily available for forex and specifically the Metatrader trading platform, which is by far the most popular choice for fx traders. Auto trade signals allow the trades of a professional forex trader to be copied onto the trading account of the clients. Usually clients can choose the lot size they want to trade, since the master trader’s account may be larger or smaller than the clients.
Auto trade signals for forex allow much greater flexibility to both traders and providers alike. The traders can now execute intraday or even scalp trades, if the signals can be copied quickly enough to not affect results significantly for the subscribers. It gives freedom to the clients because they do not need to constantly monitor their trading platform, or even be near a computer. The signals are copied automatically as long as the customer has their trading platform running.
Since offering signals has become so much simpler in the world of forex, many people have begun offering them, but unfortunately the vast majority of providers are not qualified to be selling signals to the public. People are offering signals that have no concept about capital preservation, risk control, or how to achieve consistent profits. That is why potential subscribers need to do their homework first before allowing anyone to place trades on their live account.
The biggest thing to look for is a clear trade history that is 100% verifiable. For instance, all of my trades are verified by MT4i.com, which is one of the most trusted third party websites for verifying forex trades. It is virtually impossible to post fake through that website, which is why I like using them. I want my subscribers to know that I operate with complete transparency and honesty. You also want to make sure that the provider does not suffer large draw downs. Many providers hide their poor performance, by allowing losing positions to have huge draw downs, and then only listing winning closed trades on their trade history. You can view my risk and draw down, and you will see that I always control the draw down tightly, so there is never a risk of blowing up an account through one or two bad trades.
I offer a free trial to my service if you decide to try out my auto forex signals.
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