If you‘ve done so much Forex trading over time, you probably know how exhausting the process can be, especially if things don’t go as planned. It is a dream of many traders to get an intelligent partner untainted by emotions, logical, who always aim for profitable trades, and executes them almost instantly. If you‘re one of them searching for all of this, don’t worry — you can get it all with an automated Forex trading system.

Before implementing automated trading into your strategy, make sure you weigh both its pros and cons. Lets break it down one by one.

Advantages of Automated Forex Trading:

There is a long list of advantages to having an automated/algorithmic trading system coupled with your forex strategy. A few of them are as follows:

1. Emotional detachment — A major advantage of automated forex trading is that it removes emotional and psychological influences. By using an automated Forex trading system, you will be able to make consistent and unemotional trading decisions based on parameters you have previously defined or those installed by default.

2. Effort-Saving — Algorithmic trading usually requires very little individual effort on the part of the trader. Computerized methods automatically place buy and sell orders based on different technical symptoms. It also allows the trader to personalize the trading strategy for better results.

3. Faster Execution — Algorithmic trading has significantly reduced Forex transaction times over the last few years by automating certain processes. The automation of these processes, such as the execution of trade orders, not only produces efficiency but also lowers their costs. It has been proven that automatic execution of trade orders and transactions is more efficient than manual execution.

4. Proficient Trade Analysis — Automated forex trading software tracks multiple market timeframes and analyzes data charts to determine accurate trends in currency prices. With the use of machine learning technology in the Forex market, it is possible to forecast trading signals such as spread discrepancies, price trends, and market news so that it can profit on currency pair trades.

5. Quicker Transactions — Fintech enhancements are providing a potential solution to the growing consumer demand for transparency and efficiency in Forex transactions, and it is completely transforming the sector. Forex transactions, including deposits and withdrawals, were made easier and faster by automated technology. A variety of payment methods were also made possible by these technologies.

6. Evolving Workflows — The advancement of trading technologies also reduces the burden of data retrieval activities. With the advances in artificial intelligence (AI), machine learning (ML), and natural language processing (NLP), forex trading workflows can be simplified, allowing for quicker, more accurate, and more accurate decision-making.

7. A better researcher — Automated forex trading gathers more historical data than human traders. This means that for a strategy that covers several currency pairs or markets, you can probably monitor only a few of them at once. On the other hand, automated trading can be set up to monitor as many charts as you like, and they will not miss any signals or trends.

8. Diversifying Trading — Automated forex trading allows the user to trade with multiple accounts and apply various strategies at the same time. As a result, the risk can be spread across a variety of instruments while hedges against losing positions are created. Humans would have difficulty accomplishing what a computer can do efficiently and in milliseconds. Besides scanning for trading opportunities across a range of markets, the computer can generate orders and monitor trades as well.

Disadvantages of Automated Forex Trading:

Despite the fact that automated forex trading is touted as a fantastic investment tool, there are some downsides that traders should be aware of. Here are a few of them:

Nothing is certain — No matter how knowledgeable you are in Forex trading; mistakes do happen regardless of how experienced you are. Automated trading is no different. There is no Forex AI trading software that can guarantee a 100% win rate. Also, keep in mind that success in the past does not guarantee success going forward. Nevertheless, automated forex trading can provide a competitive edge only if used correctly.

Over-Optimizing — There is a misconception that automating your system will result in more winning streaks. Since they hold this belief, they tend to optimize their trading strategies too much in anticipation of good returns on the currency market. The truth is, over-optimizing a strategy for the live market may lead to unreliable results in the future.

Monitoring is necessary — Some people assume that automating their trading is as simple as turning on the computer and letting the software handle everything. The thinking is not entirely wrong, but the system is not infallible and requires regular monitoring due to malfunctions, lost internet, and other technical failures. Software malfunctions could result in duplicate or lost orders, which makes monitoring necessary.

There‘s nothing perfect in this world, and automated Forex trading is no exception even though it’s an extremely popular and interesting tool. The best thing to do is to use both types of trading methods to your advantage. It is better to automate the systems that are easy to implement and too difficult to trade manually, while simple strategies that involve chart patterns and fundamental analysis are better off being performed manually.

Which is the best platform for Automated Forex Trading？

Despite the availability of a variety of trading platforms that facilitate automated Forex trading processes, MetaTrader is the most prevalent of all. With MetaTrader 4 and MetaTrader 5, traders are able to trade multiple markets simultaneously from a single platform, along with advanced charting capabilities.

While algorithmic trading offers many benefits, it is important to ensure that your trading platform is compatible with it. Listed below are three important factors that make MetaTrader the best platform for automated Forex trading:

• Metatrader is easy to use: It is very easy to open and close trades with MetaTrader even for a beginner.

• Metatrader is user-friendly: You can use MetaTrader to execute any trading strategy you want.

• Metatrader is customizable and professional: MetaTrader can be configured to perform both automatic and manual trades, making it perfect for a wide variety of trading needs.

The AximTrade MT4 platform is fully compatible with most PC and mobile devices, so gives you the power to access the market wherever and whenever you want, and keep up-to-date with current market activity from the convenience of your phone or laptop. Heres how to download and install AximTrade MetaTrader 4 (MT4) so you can start using it right away.

Original Article: Pros and Cons of Automated Forex Trading Systems

Disclaimer: This post is from Aximdaily and it is considered a marketing publication and does not constitute investment advice or research. Its content represents the general views of our editors and does not consider individual readers personal circumstances, investment experience, or current financial situation.