What is a Forex expert Advisor

What is a Forex expert Advisor

About advisors for Forex does not mean just lazy. They are offered for free, for testing or for purchase not only by brokerage companies, but also by many third-party developers.

Forex expert Advisor is an automated assistant. It has built-in algorithms, which takes the assessment of market situation, forecasting, search candlestick patterns and chart patterns in technical analysis and also trade by specified algorithm.

They make it much easier to work with the terminal, performing most of the analytical work of the trader.

Most of the expert advisors of the last category are able to trade after pre-setting, that is, without the participation of the trader to open and close trades, placing protective and target orders.

Professionally written expert advisors for Forex trading is quite profitable, subject to the rules of working with them.

Among these rules, for example, disable automatic trading during the release of important news or bookmark in the settings of the chart output of such during the current trading week.

The use of expert advisors allows the trader to free up a significant amount of time to search for new opportunities for profit.

Forex advisors are a whole industry created by traders for traders and include multiple areas, which we will discuss below.

Historically, the vast majority of expert advisors are automated trading systems.

Other, even the most advanced programs for market analysis or determining price patterns or technical analysis figures are called and considered indicators.

Almost all of them are created with this understanding and directly Forex advisors called trading systems, converted into an automatic algorithm.

Classification of Forex advisors

Briefly list and make a description of Forex advisors by category.

Trend advisors

The most simple, but no less profitable. Because of the simplicity are popular with beginners, because of the profitability-the veterans of trading.

The expert Advisor determines the presence / absence of a trend for the selected instrument and, if there is a trend, opens trades only in the direction of the main movement.

It is not difficult to adapt your own strategy in such an expert Advisor, so its popularity is deserved. The disadvantage is the possible loss when the price moves sideways or when the trend changes.

Martingale

This is a world-famous principle of trading or gambling, which could not appear as an adviser. Today, they are offered a huge number and many traders use them in their work.

They have defenders, presenting evidence of high profit and lack of risk in the trade. On the other hand, there are opponents who say that a series of drawdowns in a row can destroy the largest Deposit.

Forex scalping expert advisors

Popular because pips trading strategies, with opening trades for a few seconds or minutes and a profit of a few points, are very difficult for manual execution.

Forex trading Advisor with embedded scalping algorithm keeps under control hundreds of simultaneously open trades around the clock. Well-tuned scalpers in the long term are the most profitable.

Neural advisors

Progress in the development of neural networks allows you to create advisors that are more like a person and assess the current market situation more globally and verified.

They rely on the entire history of trading for each instrument, note successful and losing trades and are able to learn. However, they require adjustment and optimization, because they may not adequately perceive the reality and enter the account at a loss.

Grid advisors

Such advisors do not evaluate the current market situation, but open deals from the current price in both directions. When the price goes some distance, a new trade is opened or an order is triggered.

Thus, the method of averaging the position works and with a sufficient level of Deposit, the profit will be fixed in any situation. The drawback is that when moving against the opened deal, you can wait for weeks until it closes.

Indicators EA

They include a set of indicators and oscillators for calculating the entry point into the transaction, signaling the appearance of a potential transaction, as well as placing orders for profit and loss.

Good work on the direction of the market and make mistakes when you change the trend or flat.

Does not use any indicators

They do not project signals to the trader, but also place profit and loss orders, which can adjust or close the deal when the price is rolled back. They use candlestick patterns and technical analysis models.

Both of the above categories require constant attention and customization, as well as backtesting under current settings and market circumstances.

Combined

These expert advisors combine two or more trading methods that complement each other and make its work more profitable.

Also determine the restrictions that will be imposed on trading. For example, do not trade on the news and during the opening of the session in the country of the opposite traded pair.

Trading Advisor is designed to help the trader in the work, taking over part of the standard actions and Analytics, but it is not a panacea in trading and expanding knowledge about the market and its manifestations remains a priority for everyone.

How to test Forex expert Advisor

Due to the large number of types of expert advisors, their specific versions and settings, it is impossible to get a good result without adjusting the proposed robot to a specific trader with his own style of work.

The network is not small and those who under the guise of copyright advisers with a high level of profitability offers for very serious money, in General, downloaded from a free resource Ilan or something similar, configured for aggressive trading.

Testing Forex advisors is a prerequisite for making a profit from their trading. It is made on the history of quotations directly in the MT4 terminal. For this purpose it is necessary to make a series of manipulations.

Since the Forex expert Advisor is tested on the history of quotes provided by the broker, you must first configure the terminal:

  • Go to the tab Tools = > Settings = > archive quotes. By default, the number of bars for indicators and expert advisors is set at 65,000. In order to produce high-quality tests of Forex advisors, it is necessary to use all the history available to the broker. Fill in the “number of bars” column with the maximum number of zeros after one.
  • Now we need to load into the terminal the entire archive of quotations. Click Tools => history center. Select the desired currency pair or several, and select for all timeframes M1 and click download. The process may take some time. After the download, restart the terminal.
  • Now go to a special section of the terminal — “strategy Tester”. At the beginning, we need to select the type of product we will be testing from the drop-down menu. There are two options: expert Advisor or indicator.
  • In the opened unit under the drop down menu “Advisor” available downloaded to the terminal advisers. If the required is not listed, reload it to the terminal.
  • The following is the selection of the pair to be tested. Do not forget to download quotes for each pair.
  • Choice of modeling. The terminal offers three testing options, but for maximum reliability it is customary to use the “all ticks”tab.
  • The choice of period. Here you can specify the historical segment on which the testing will be performed. Specify it adequately given the current market realities.
  • In the “Spread” point, mark the maximum spread offered by the broker for the current moment. This can greatly affect the test results.
  • Input parameter. These are the subtle settings of the EA, which it will work on the history. If the test occurs for the first time, use the data supplied with the EA files from the file with the *set extension. For subsequent tests with the changed parameters, be sure to fix for yourself what exactly was changed and what results it led to.
  • After all settings click on “Start”.

As a result, we get a comprehensive test of the strategy embedded in the EA with the current settings. In addition to specific figures on the total profit and drawdown, the tester will provide a curve of the Deposit change in each trading period.

Forex expert Advisor tests can show significant differences when changing the settings, as well as increasing the degree of risk per trade or stop loss and take profit levels. Choose the best option for yourself.

Above we looked at how Forex advisors work and came to the conclusion that without constant control over them, they can lead the trader to ruin. Don’t let the beautiful reports of the advisors mislead you.

Is it possible to make money on Forex with an expert Advisor

Millions of traders around the world use expert advisors in their trading. Someone relies on them more, someone less, but somehow use.

You can make money on Forex with an expert Advisor, but this method has its pitfalls and limitations:

  • Careful evaluation of the seller before purchase. Reputable companies value their reputation and will not release a crude product to the market, introducing traders at a loss. Learn the history of sales of such companies, line Advisor and customer reviews. Do not trust third-party vendors and those who offer expert advisors of their own design.
  • Testing on history, as well as on a real account with minimal risk, on a cent or demo account. Not infrequently indicators on the history and the current situation may vary. Perhaps you need to adjust the settings, and perhaps even stop trading with this robot.
  • Monitoring of open trades and record the history of trades for each EA used.
  • Noninterference. This condition should be put first in all lists. Most even the most advanced and experienced traders sin by interfering in the process at critical moments in order to prevent a loss or the desire to grow profits. To do this cannot be flatly. Advisor and works to exclude from the trading system emotions inherent in man.
  • Market research. Track the development of the algorithm from the manufacturer and other traders using the product. Often, a change in one indicator in the assessment of the market situation makes trading more profitable. But no changes are made without testing!

Conclusion

Forex Advisor is quite capable of becoming a worthy assistant to the trader, taking on the routine function of assessing the market situation and the opening of typical transactions.

The trader himself at this moment can study the market from the other side or do other things. But do not forget that even the most advanced Advisor will not be able to “see” the release of important news or an earthquake in one of the countries, as well as other force majeure.