Automated Forex Trading System: Faster Execution Means Increased Trade Volumes. Helpful Points to Remember

The notion of automated Forex trading system is mind-catching.

Before the automation of the Forex market, exchange-traded futures market was the first to begin automation. Then, the traders on the Interbank spot FX market decided to catch up with the most recent trend and moved too to the new system.

Automated Forex trading system enables traders to execute their trade on spot Forex market automatically and anytime of the day, based on existing technical indicators and custom trading rules. There are different features included in the automated trading system, for instance:

• Automatic trailing stops especially if the trader is losing in a particular trade position;
• Account equity management;
• Stop and/or limit orders;
• Discretionary market orders; and
• A range of 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 depend on the technology used plus the presented 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 sensation of the automation process to the Forex market is attributed to several factors, for instance the next:

• Its ability to make or execute trades in real time. Due to the automation, a trader can close trades within a few milliseconds. It is not possible in manual systems, as previous trades are generally closed after several hours. As well, there are in addition instances wherein a trader incurs several losses in a row that prevents him from making any fresh transactions. Thus, with automated Forex trading system, this dilemma could be avoided.

• Its ability to better diversification. With automated trading system now in place, a trader can trade in a variety of local as well as international markets in varying time zones. In other words, you can place trade or close deals with various traders from different markets around the world even in the middle of the night.

• Its ability to scrutinize short-term data. This feature is not offered in manual trading system. Hence, traders using automated system have the better advantage because they can predict market trends in less than an hour.

If you will combine 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, as a result increasing the average volume trades day by day.

To more explain the conclusion. Let us take the next scenario: If you are trading using the manual system, you will see that it takes time before a trader confirms if he will accept your deal or not. He will look on the market circumstance initially and the exchange rate of the currencies that you are trading with. Consequently, if it takes time before a deal 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 situation could be done within some minutes, because Forex data are currently updated in actual time. Probably after less than an hour, you will be able to take your position whether you will push through the transaction or not. If a Forex transaction 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 usual number of trade per day. Combining it with the number of Forex markets around the world, the figure is just giant sufficient.

Also, the technology is changing always, as a result there is a tendency that the average number of trades per day will increase, 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. Dealings are now faster, and earning money through Forex trading is at this time easier.

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