The disadvantages and advantages of forex automated trading robots or EA

Automated trading robot or EA

Have you ever heard the word robot or trading robot? which is actually a computer program designed to make transactions automatically following the algorithm that has entered the program?

The cool name of the trading robot is an automated trading autopilot or we call the most popular "Expert Advisor".

Automated trading robot or EA is an electronic tool that works alone to find open trade opportunities, both open sell or buy on the forex market.

EA is software for forex trading automatically. Without you doing the Buy or Sell order, the robot will do it yourself for you.

Now there are lots of EAs, both free and paid forex robots. When compared with manual trading robots can be a solution because it can help when there are moments and opportunities, but we need more capital if we want to get a quality EA.

Well, not always a profitable trading robot but almost these trading robots have disadvantages and advantages, such as


Disadvantages of EA:

  • The price is expensive

Trading using robots requires more capital because most quality robots have very high prices.

Although now there are also many free robots most expectations are not following reality and the performance is arguably far less than that paid.

  • Requires special skills to manage it

Who says if you already use Forex Trading Robot do not need any knowledge about trading?

Because of the trading process fully automated, at certain moments, the first person to take control of the robot is the user.

For this reason, it is advisable to use a Forex Trading Robot if you have enough trading experience and have the sharpness of intuition in knowing when market conditions are not conducive.

Besides, users must understand the terms of using software to install and maintain Forex trading robots.

This needs to learn so that the robot continues to run according to the procedure.

  • Requires an additional fee for VPS rental

Trading using an EA robot costs more than manual trading.

Besides spending money to buy the robot itself, you also have to pay VPS rental fees regularly. The better the quality, the higher the cost.

Not able to adjust to certain market conditions. When news releases are high impact, usually many traders take advantage of the moment to make a profit.

News trading usually carried out by scalpers where the activity is much higher risk than trading in normal market conditions.

If you're lucky, you can get a lot of money, but if you're unlucky, then the money can sell out instantly. Unfortunately, trading robots not designed to adapt to the situation.

That's because basically because the trading robot designed linearly, while at the time of the news release the movement moves lucratively and randomly.

  • Not all brokers allow to use it

Robots can spend tens to hundreds of market orders in a relatively short period.

If enough traders use Robot Trading, the broker's server burdened by a long queue of market orders. In this situation, the broker server could experience lag or even freeze.

So, to avoid lag and freeze servers, some brokers will prohibit the use of Forex trading robots on certain types of accounts or pairs.

Advantages of EA:

  • Can trade active 24 hours 7 days non-stop

As long as we connect it to the VPS, the EA can work all day while the market is open.

So, once there is a trading opportunity, the Robot will always be ready to execute market orders.

If you use an EA, then you no longer have to worry about missing out on trading opportunities even though you are busy with other activities.

  • Not affected by emotions or lust

EA only carries out instructions according to programming standards, so that robots do not have passions and emotions like humans.

This means that the EA will execute the order and place the Stop Loss and Take Profit exactly as the program planned.

If in manual trading, traders easily affected by emotions when facing price fluctuations. They will usually shift the position of SL and TP because of feeling greedy or anxious.

In the long run, these bad habits can be a barrier to success, so that emotion-free EAs seen as superior to inexperienced traders.

  • We can test trading performance

Because Robots always consistently follow the programming standards, we can also measure their trading performance.

The performance of trading robots measured by the backrest and forward testing methods. So, before you buy a Forex Trading Robot, first make sure that the report performs well.

  • Can do multitasking

Forex Trading Robots can run hundreds to thousands of instructions per second to comb and execute every forex trading opportunity.

The workload exceeds the limits of human capability, but EA can do it.

However, not all Forex Trading Robots have that high performance because it depends on the manufacturing system.

  • Features are constantly being updated and developed.

Over time, they developed EA more and more new features to keep up with market dynamics.

For example, the news filter features an invisible mode for money is useful for avoiding brokers who are the stop-loss hunting.

Usually, to enjoy the most advanced features, look for robot developers that provide auto-updates. With these features, they will update EA with the latest features.

There are some advantages and disadvantages of trading robots. Nowadays robot trading is a lucrative business and widely used by people to get income from selling robot services. The thing is I often see the homepage on one of my social media contents with people who advertise EA. :)

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