TMCnet Feature
October 26, 2020

What Are The Best Forex Trading Signals and How to Use Them?



Using forex trading signals has changed over the last 14 years when there were no smartphones, and therefore no mobile trading of any sort. This meant that all forex and share trading had to be done on a computer: a desktop or laptop. Desktop devices in those days were quite bulky, so trading with them meant that you had to be confined to your private office or at home. There were also no touchscreen laptops in those days. Laptops were bulky and cumbersome, and the notebooks at the time were certainly not as advanced as they are now.



So without the flexibility of smartphones which enabled you to check any information online or to check on any trade alert sent by email, using a forex trading signals service in those days meant you had to be glued to your computer all day long.

Given the flexibility offered by smartphones today, most millennial traders may not understand the inconvenience that having to stay close to your system so as not to risk losing a trading opportunity, brought on the trading individual. The computer dominated the trader's life as everything about trading had to be done there. If you were a 9 to 5 worker, it was practically impossible to do any form of fair trading. It meant you had to cancel appointments or forgo a large chunk of your social life to catch and trade the forex trading signals.

Back then, the only avenues to receive forex trading signals then were through the SMS or email. Some providers required that you had to sign into your members' area after subscribing on their website. Sites in those days did not have a self-refreshing mechanism. Even the web browsers of those days did not have these mechanisms. So the individual had to keep refreshing the page to be able to view any new signals that had been posted. This was a very boring and dreary affair.

The entrance of smartphones into the world of trading was a game-changer. It meant that traders could now receive signals notifications on their phones. So anytime forex trading signals were sent by email or by SMS, audible alerts could be picked up and used immediately on mobile trading platforms. But even when the smartphones came into play, the concept of copy trading was still very new and had not been perfected to what it is today. The best forex trading signals are those which are delivered using copy trading engines. If the whole process is not automated, it is not worth undertaking.

Why Are the Best Signals the Automated Ones?

Forex trading signals can be delivered manually, or they can be delivered to subscribed accounts using copy trading engines. Irrespective of the method of delivery, the essence of the trade signals is to communicate to another trader, exact entry and exit points on a particular currency pair to profit from the generated trades.

In the early days, signals were sent manually by email or SMS, or they appeared on the members' area of the website where users who needed these signals had to subscribe. This was not a perfect system, and the problems and inconveniences associated with the manual method have been outlined above.

The automated system of delivery forex trading signals has eliminated many of the inconveniences of the whole system. Here is why the best forex trading signals are those delivered using the automated trading systems.

  1. There are methods of evaluating the forex trading signals that are sent. The copy trading engines allow subscribers to add multiple accounts. Some of these accounts can be demo trading accounts, which let the user see how profitable the forex trading signals from a particular provider are before applying them to a live account.
  2. The copy trading engines of today allow several forex trading signals providers to come into one single platform such as Metatrader. This way, you can get forex trading signals from several different providers at the same time. While this is not a guarantee that your results will be much better, you at least have the advantage of choice.
  3.  You can also evaluate the training results of the providers of forex trading signal services beforehand so that you know exactly what you are dealing with or what you're paying for.

Now let us look at what the best forex trading signals are.

What Are the Best Forex Trading Signals?

The best forex trading signals must have the following characteristics:

  1. The trades generated by the best forex trading signals must be able to follow the trend. Trade transactions that go against the trend are risky and can lead to colossal losses. More on this later.
  2. The signals must not generate trades close to when the news is to be released. A news trade can easily make an existing trade goal awry.
  3. The signals should have a high degree of profitability.
  4. The best forex trading signals are able to calculate the risk involved in every trade and set the protection stop accordingly.

How to Choose the Best Service?

Due to the multiplicities of scams in this area, as well as the numerous signals services that do not deliver on their mandates, this article will end with an attempt to tell you how to select the best forex trading signals services.

Profitability and Veracity of Trade History

The number one priority for a trader is to look for a forex signals trading service that is profitable. After all, you are in it to make money. If you are not making money, you are better off doing something else.

No signals provider will claim to lose money. Many of them will go to the extent of embellishing their records. So you have to sift through the garbage to find the crown jewels. One way of doing this is to look for verified trading history.

This is where copy trading engines beat the manual systems. Many copy trading engines require that the providers submit at least 6 months of trade history to be able to enlist as a signals provider. This allows you the chance to evaluate the track record of all listed signals providers. With manual signals providers who still use the email/SMS system or those who use social media channels such as Telegram, this is more difficult. You will have to rely on results which are provided by the signals provider, but which cannot be independently verified.

So your best bet is to use forex trading signals providers found on copy trading engines, or at least signals providers whose track records can be verified by third-party mechanisms. Ensure that the trading history you are checking is marked "Real", showing that a real money account was used in doing the trading.

Use Trial Periods If They Are Available

There is nothing wrong in using the mantra: try before you buy. Many forex trading signals services allow you a one-week trial with which to assess providers on a real-time basis before you commit financially to a subscription. There is a lot you can check during a trial period. Apart from validating the profitability of signals sent by a provider, you can also look at other parameters such as duration of trades, how many trade signals are opened, whether the trader obeys rules of risk management, and other trade-related matters.

Time Zone Element

This factor does not matter if you are using a forex trading signals provider that transmits signals to your account using a copy trading service. But if you will be using signals sent manually, then it makes sense to choose a forex trading signals service which operates within your time zone. It will not make sense to use a signals provider in a different time zone as signals will probably be sent during your sleeping hours, which negates the entire venture completely.

Trading Style

There are elements that you should check in the trading history of the forex trading signals service you want to use. One of these is the trading style of the provider. Not all trading styles may suit your account profile. For instance, if the provider does not use a stop loss and the trading duration of the trades are a few minutes to one hour, then you are dealing with a scalper. Scalping may fit an account which does not have a lot of money in it, but that also increases the risk component.

Also, check if the provider tends to open many trade positions at the same time. Is your account size large enough to keep several trades open and still handle more? These are crucial factors you need to assess when choosing a forex trading signals service.



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