Forex Alerts - Are you limiting your profits?

Forex Alerts - Are you limiting your profits?

One of the biggest drawbacks of Forex trader is the time it takes to follow often fast moving and volatile currency markets, so that advantage can be taken at the entrance and exit points for trading. For many traders it means sitting in front of their computer screen and watching the markets for hours on end.

One way around this problem is to make use of automation and place limits and stops on your orders. In this way, you can walk away from your screen safe in the knowledge that, if nothing else, at least your losses are kept to a minimum. The problem here though is that also often miss out on potential profits because of the limit kicks in too early.

So just how do you solve this problem?

The simplest solution is to use a Forex signal service that will both monitor and analyze the markets for you, then notify you when needed through various channels, including on-screen reporting, email, SMS and pager messages.

Forex signal services are provided on a subscription basis, paid either monthly or annually, and also may be provided by your broker as an additional service that can be integrated into their commercial software.

Most signal services limited number of currency pairs where the service works, but most will offer services to major trading currencies including the dollar against the euro, Britain, JPY and CHF. Many companies also provide specialist services less frequently traded currency pairs.

Most services use a combination of factors in identifying market trends and recommended entry and exit points, but all are based in the technical analysis of currency markets. These services essentially collect currency charts, and then use different mathematical models to make their trading recommendations.

For example, they can use a simple moving average Buy signal to cause as currency prices move above the average line and sell signals as prices fall below the moving average. In addition, the volume indicators can also be used to indicate the level of interest in the market with large scale, especially when it occurs near the bottom of the market, suggesting a possible beginning of a new trend and low volume indicates investor uncertainty.

Of course, this is something simplistic picture is used here only to illustrate the nature of Forex signal services. In reality a number of tools used, including those already mentioned and many others like Bollinger bands and momentum and volatility, and these together form part of a complex mathematical model that generates the signals sent to subscribers.

Services will of course vary considerably, as with anything else in life, and they are very busy merchant using only one tool in the toolbox. They are certainly not infallible, and only your own experience of using these services will truly determine whether or not sufficient benefit to ensure cost anywhere from about $ 50 to $ 200 per month.

One important point to remember is that the Forex signal services give you advice and nothing more. It is up to you to take that advice and act on it, or not as their knowledge and experience tells you. If you simply take the advice provided by the service and then act blindly, if you have very good service, you can come out on top, but in many cases, you will find that your trading is less than successful.