Forex Trading Automation Using Expert Advisors and Robots
4 min read
Expert Advisors are trading programs that automate your decision-making and remove all the emotional trauma, the fear and greed, that causes you to make poor trading decisions. This type of automation allows you to feel confident of the trade choice, and allows you to backtest strategies.
At the end of it all (and if they haven’t shut me down by now) let me conclude by suggesting that any decision about robot trading systems – whether to use them or not – needs to take into account all their angelic and demonic attributes. If you do decide to use them – use them as part of an overall trading plan.
MetaQuotes
Forx Robot Factory is a comprehensive tool that makes it easy to create an expert advisor (trading robot, EA) for usage on MT4 platforms. The program provides a ready-made template comprising a tradable strategy, coupled with the backtesting process, to see whether this robot will function effectively on your trading platform from the start. Since Forex Robot Factory «includes support of the common MT4 indicators», you will also get an all-important stability for your advanced trading solution, and thus it will provide solid, reliable results.
EAs help traders automate strategies and eliminate emotion from trading decisions, so account balance management is more consistent during periods of volatility. Still, they need to be vigilantly monitored: top robotic traders constantly review how their programs perform and adjust them as the market evolves.
Another pro that day traders point to is that experts provide market exposure across a number of markets. Some EAs don’t play well together; many aren’t designed to be run at the same time, because their forex robot code inevitably clashes with each other. So it’s wise to test an EA in various markets and conditions before setting it to work live.
MQL4/MQL5 programming languages
MQL is a high level object oriented programming language similar to C++ but designed for developing Expert Advisors and technical indicators. You’ll be able to create programs to perform specific actions when certain events occur – for example, it could initialize, deinitialize, react to quotes flowing into the system, or detect changes to a chart you’re viewing – all through your terminal terminal.
User adoption is good: MQL4 debuted with the initial release of MetaTrader 4 in 2005. It’s got a voluminous codebase, with plenty of examples, and an active user community willing to advise. While MQL4 wasn’t as completely overhauled as previous incarnations, with build 600 of MetaTrader 4 it was brought a bit closer to MQL5: all the style libraries were consolidated into a single style library, and debugging has now been accommodated; it can also support EAs that trade on multiple symbols at the same time; optimisation has been improved, as has risk/yield analysis and prediction.
EA development
EA development is never finished, and, like any other IT project, requires a dedicated team of experienced, certified enterprise architects. It is also important to remember that any EA project’s output will benefit more from integrating business issues and technology issues than it would if it were to neglect business issues; otherwise, an organisation will struggle to adopt and sustain EA.
EA provides much-needed support to teams, such as more effective ways to communicate or to crack leadership decisions where most need it. It also helps organisations to see into the future with its ‘what if?’ simulations – those models must, of course, be driven by timely, quality data, or else their use and their value are undermined.
Dragon1 supports Enterprise Architecture by allowing projects to access information they need to make decisions without having an enterprise architect act as a bottleneck or forcing them to conform to IT landscape-standardisation initiatives. It allows for innovation at the fast pace necessary while also reducing costs. In addition, it allows organisations to sidestep analysis paralysis and groupthink.
EA testing
Every conceivable price-affecting condition is taken into account when making a strategy: no stone is left unturned when it comes to maximising the effectiveness of trading systems.
EAs also allow traders to trade with multiple currencies at the same time, which, again, spreads the risk. Secondly, the robots won’t get greedy or lose their heads and transgress the chosen strategy as real humans can and do.
But because they are so easy to test, they can be subject to over-optimisation – fine-tuning them to squeeze out every possible profit based on historical market prices – with profits degrading over time. Often profits reduce over time.
If you want to trade on EA, it is recommended that the EA is written by a trader and a programmer so that they are able to assess each other’s work and therefore it will be easier to make a winning strategy. Secondly, a good EA algorithm is supposed to be regularly updated according to the market conditions and trends. Otherwise, you could get stuck with an advisor that suddenly stops working. How to do an easy regular update? you just need to tick the …. in the “Navigator” window.
