Forex Trading Signals – What Are They And Why Use Them?
The idea of being able to make money from trading Forex on the internet has resulted in more people than ever trying their hand at the Forex game. Unfortunately for most, without the years of experience and the vast wealth of knowledge that seasoned traders have amassed over the years, their efforts are rarely more than disappointing. Although there is no real substitute for knowledge and experience of any profession, Forex trading signals are popular because they allow a relative novice to the game a chance to profit where they would have otherwise traded purely on chance.
Because of the sheer amount of time it would take someone to fully master the art of Forex trading, services that offer Forex signals have become increasingly popular over the last few years. These services will, usually for a monthly subscription fee, alert the subscriber when they feel a potentially profitable trade has arisen in the market. The subscriber will then have a window of opportunity in which to follow the signal they have received, and place the trade they have been alerted to with their own broker.
The advantage of using a Forex trading signals service, is that a novice trader can benefit from the knowledge of a more experienced trader and place a profitable trade that they themselves would probably not have identified. In theory, this set-up will work quite well. The person(s) providing the signals are able to leverage their knowledge of the Forex markets beyond merely trading themselves, but by selling their expertise to subscribers of their system. Note that these traders selling signals do not actually teach subscribers their trading system, as it is more profitable to simply alert them when their system identifies a positive trade.
Forex trading signals services are popular for one main reason: when executed correctly they work and are mutually beneficial to both the subscribers and the traders selling their signals. Unfortunately, as is often the case, there are those who are more interested in exploiting the popularity of these services and those who seek to benefit from them. Services that claim to be operated by Forex trading ‘professionals’ are often nothing of the kind, and the signals they provide are simple auto-generated by a computer program. These systems are no more beneficial to someone looking to profit from Forex trading than the numerous trading robots, or expert advisors, that are currently on the market.
A good Forex trading signals service should provide two things. Firstly, it should provide its subscribers with signals that have a high probability of turning profitable, and these signals should be generated by real human traders with a sound knowledge of the financial markets. Secondly, such a service should allow a subscriber to actually gain a deeper understanding of the Forex markets, and in time be able to trade independently of the service using their own Forex strategies.