Despite all the hype about the Forex Robot as the solution to making money through forex trading, we should always keep in mind that the Forex market is a rather difficult market to trade and is among the most unpredictable as the market is always changing. This trade almost always carries significant risk.
A newcomer can be easily confused as there are a lot of experts around giving advice to every newcomer, be it on using Forex robot or automated trading strategy. So how to determine which one is a myth?
Myth 1 – Forex robots which are “clever” and complicated have the best results
This is not true. Sometimes, the most simple systems are the ones that may work best as
they use simple algorithms based on fewer elements. Although some of these programs may have been designed by clever people but many of these are not traders and this may be a weakness in the long run.
There is nothing like testing it out to know which robot has the best results.
Myth 2 – Science Can Provide Accurate Predictive Systems
Forex trading has always relied on mathematical calculations to analyze trading trends to help generate signals. Some of these mathematical calculations have proven to be really effective such as those based on Fibonacci signals. However, much as they have been useful to analyze the market, they have not always been accurate when incorporated into systems to predict the market. If they were foolproof, no one would be losing money in forex trading.
Nevertheless, overall, the forex robot can improve your edge and with the right choice of bot, you can improve your odds for making money.
Myth 3 – The Forex robot can eliminate loss
Although some vendors claim their Forex robot to have zero losses, this is not the case as many have lost money. There are probably about 95 percent of traders who lose their money with only the remaining 5% making money. Many of the losers are also using Forex robots.
You still need a strategy on how best to use the bot.
Myth 4 – The Forex robot can operate on its own and make money for you
Many sales pages claim that you can just turn on your computer and let the forex robot operate on its own to trade and finish deals for you, without you even participating in the process. A few traders doing this may have been successful but for me, I feel that every trading system has to be monitored.
The reality is that you may want to change or adjust your strategies as the market changes. The situation is never static. Unless robots are updated frequently, they cannot perform well consistently over time.
• Myth 5 – Success in demo accounts is the same for actual trade
Whilst paper trades are a good indication of a forex robot’s performance, it is not the same as actual trade and for some, it may not show the same results in the real account. There are always other factors that could come in to make it risky.
So it should be actually tested in real trades. Demo trades are not enough proof of success.
In conclusion, although the forex robot can increase your potential for profit as proven by some traders, you should not assume that the above myths on the forex robot are absolutely true. However, forex robots have a lot of potential and if properly used and selected, they can help you to make money.
