Everybody dreams of making a lot of money with minimal effort. Foreign exchange traders are drawn to this dream, thinking an automated Forex trading system will help them realize it. But is it really possible to just turn the system on and wait for the money to come in? The manufacturers might make you believe so. Yes, it can help you make money. But, the sad truth is, many traders still end up losing rather than earning.
Let us try to see why the promised autopilot fails to make the said dream a reality.
A lot of Forex robots in the market today boast of track records claiming huge profits. What some traders fail to notice is that these claims are based on paper simulation. What it comes down to is that the program simply knows all the market prices. This is not proof that it will bring in profits. To know how much the closing prices are is not all there is to it in trading. So, in choosing a good system, do not go for simulated ones. Choose those that have proven records over a long period of time.
Do you wonder why some traders still do not succeed even if they are using good programs? While the simulated programs do not have real losses in real time, in the existing trading world, you will suffer losses. You do not need to fear these losses, as they do happen to everyone. This does not mean though that your losses are permanent. You can still make profits. For the moment, you will just need to ride out this short-term drawdown.
Some systems put you in a period of drawdown. During these times, avoid making emotional trading mistakes. Keep in mind that markets fluctuate and losses are normal so do not stop adhering to your trading signals. It is imperative that you maintain your mindset and discipline until you gain profits again. You can psych yourself up for this by identifying your worst drawdown and assuming at all times that it is just ahead. To add to that, always understand and believe in your strategy as well as your system so you will not hesitate to act accordingly.
Despite what is said in the previous arguments, an automated Forex trading system can work. It is a useful tool and it does work. However, contrary to what manufacturers might say, do not expect consistent profits and zero losses. No matter how intelligent the tool is, you would still need to rely on your own strategy rather than depend on an automated system. Unlike simulated programs, you would need to look beyond short-term and start seeing long-term.
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