By CountingPips.com
What are Forex Trading Signals and the Advantages to using MQL5 Automated Community Signals
What are Forex Trading Signals:
One of the features that has developed out of recent technological advances into electronic trading, and in conjunction with the rise of internet trading, is the wide availability and use of forex trading signals. A simple definition of a forex trading signal is an actual forex trade that was placed and sent out as a message by a trader in close-to-real time. The goal for seeking out and using trading signals is pretty simple: to find profitable trades that will help you to grow your account balance.
Finding available trading signals is as easy as an internet search away and if you purchase or subscribe to a trader’s trading signals, you are essentially purchasing the future trades of that trader.
Trading signals usually take the form of specified buy and sell price levels as well as stop-loss and take-profit exit levels. These are often sent out as messages through e-mail, text message or twitter posts. More and more frequently, trading signals are now being sent out and executed automatically to the signal subscriber’s own trading account, virtually in real time. This automatic execution of trading signals is also sometimes referred to as mirror trading, copy trading or social trading.
Why and Who are Trading Signals for:
The allure of using trading signals is that they allow the trader to have the freedom of choice. Who’s signals to subscribe to, how much money to risk, what broker to trade these signals with and, ultimately, the ability to still have total control over of the trading account. This feature is in contrast to other avenues of investing where you place money with an investor or with a fund and that money may not be easily accessible or visible for some time.
Other common reasons one may seek to use trading signals is because of a lack of discipline, emotional control, trading ideas or simply because of one not having the time to trade the markets. Current traders who seek to diversify their risk capital and non-traders who wish to employ their risk capital in the forex market but without personally trading are also potential users of trading signals.
Where to search for Forex Trading Signals:
There are many trading signal providers or mirror trading marketplaces that can be found online nowadays whether it be part of a social network or a direct marketplace. Below, we explore one of the major forex signal marketplaces, the MQL5.com Community by MetaQuotes Software, that has successfully created a free and simple way to get started implementing trading signals automatically into the popular MetaTrader platforms. Below are five key characteristics that help make the MQL5 Community a worthwhile destination for any potential subscribers looking for forex signals.
5 Advantages to Using Trading Signals from MQL5.com Community:
1. Execution directly through the Metatrader platforms
The unique advantage to using the MQL5 community signals is the ability to incorporate the signals directly in the Metatrader 4 and Metatrader 5 platforms. Metatrader 4 is the most popular retail forex trader platform and is widely adopted by almost every major online forex broker. Metatrader 5 looks to follow in its footsteps. Millions of forex traders use these terminals which means it is very likely that there will always be a high volume of Forex signals to choose from. The copying of trading signals is fully automated and is controlled right through the tools menu in your Metatrader platform.
Clicking on Tools and then Signals in the popup Options window, you can set up your desired signal and trade management settings. See a more detailed explanation here.
2. Simplicity and Ease of Setup Process
The setup process is user friendly, simple and straightforward which decreases the time it takes to get started choosing and subscribing to new signals. All you need is a MQL5 Community account and MetaTrader platform account to receive your trading signals. The platform can be either a demo account or real money account on Metatrader 4 or Metatrader 5.
3. Subscription Service to Signals
The MQL5 Community trading signals is based on a subscription service where the subscriber is in complete control of. Some signals are free while others charge a monthly price for their signals. Renewing and canceling signals can be done straight from the subscriber’s MQL5.com account which is free to use (no middleman fees) and no paperwork is needed to be filled out. Payments can be made with your MQL5 account through major payment processors like PayPal and web money.
4. Trade Parameters & Configuration Options
Rule based parameters for execution of signals are an integral part of using and configuring the signals service for subscribers. Just as in regular manual trading – market conditions, account equity and/or broker conditions can have a large affect on whether your trading is profitable. To take more control over trading conditions these trade management options are available for each trading signal:
- The ability to copy Stop-loss and Take-profit levels
- Use no more than a specified percentage of your deposit amount
- Stop taking the trading signals if your account equity falls lower than a certain threshold
- Do not take trades that are outside your specified deviation or slippage amount
5. Community Feedback & Signal Seller Screening System
A very good way to understand how a possible trading system or signal is doing is to simply read the reviews. Of course, not all comments are created equal, but there is usually some useful information to be gleamed from the comments. Commentators will often ask questions about any changes to the trading signals, trade management or leverage use and illuminate many issues or ideas that are important to keep an eye on.
Finally, the MQL5 Community rules put in a upfront screening system for signal providers. Sellers of signals must supply verifiable identification information and then the seller’s signals are put on a month trial basis before allowing the signals to be offered to the public.
Conclusion: Choosing a Signal Provider:
Remember when choosing a signal provider to test it out on a demo account first before employing on a real money account. Just like when testing a trading strategy, a trader would want to back-test or demo trade that strategy extensively before taking the plunge with real money. Same here, learn the system as best as you can by trying out some demo signal providers and put yourself in the best position to be successful using trading signals.
When it comes to using a Forex trading signal service, instead of trading, your goal is to choose the best signal providers using their available analytic criteria and trading record at your disposal. Choose signal providers that fit your trading criteria and, more importantly, that fit your risk profile.
Article written by CountingPips.com
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