Manual FOREX Trading or Automatic EA - Which Is The Best Option

The Foreign Currency Exchange market, also referred to as "FOREX" market is the world's largest and most liquefied market.  On average, the trades of more than $1.9 trillion are being executed per day in this market. This figure is confirmed by Bank for International Settlements abbreviated as "BIS". The main contributors to this huge amount of trade are banks, federal governments and several large institutions. For example, the FOREX trading giant NYSE (The New York Stock Exchange) group has a daily average trade turnover of $86.6 billion. Overall FOREX trade industry is constantly growing and it's average growth per year is 18.4%, from 1989 till present.

But the biggest dilemma of this market is that almost ninety percent of the new FOREX traders lose all their invested money just after three months of trading. There are several factors that are among the causes of this loss such as low trading skill set or use of inefficient automated tools. There has been a big debate regarding whether to go for the option of manual trading and using your own muscles to handle all the trading or to incorporate an automated FOREX trading system. Both of these approaches have their own pros and cons which will be thoroughly discussed in the following content.

Pros and Cons of Automated Trading Systems or Expert Advisors

Cons

·         While using automated FOREX trading system, you can never ignore the chances of system failure. System can crash, internet connection can be lost and all these realities can result in much bigger financial losses.

·         An automated trading EA robot also requires regular monitoring due to the possibilities such as mechanical failures, power losses, internet connection problems and computer crashes. Also, such systems can experience anomalies that can result in the placement of wrong orders as well as missing or duplicate orders. If such things are not carefully monitored, big unrecoverable financial losses can be encountered.

·         This is often the case that these systems looks tremendously well on paper but in actual live market, they perform really worse. This problem is commonly seen in over-optimized systems incorporating excessive curve-fitting to achieve extra ordinary results on historical data.

Pros

·         Automated trading is performed by computers. Nowadays, computer technology has matured up to reasonable extent and provides high degree of accuracy. Automated systems can perform calculations thousand times faster than humans with more accuracy. Also, computers have much enhanced memory and they are capable of storing heavy amount of relevant information/data which can be helpful in predicting the future price of the currencies.

·         They take all the emotions and fear out of trading. An automated system can never be deceived due to greed, hesitation and fear. It just kept on performing trade without any psychological issues. It has a set criteria and predefined rules for trading which are time tested and accurate. Such systems completely eliminates the risk of wrong decisions based on panic state of mind.

·         Automated trade systems can trade round the clock without any weariness and negligence. EA robots set their owners from the restriction of sitting in front the computer most of the time. All the trader needs is an effective and reliable trade system and then he or she can enjoy the fruits of the trading without any labor and stress. Such a system enables its owner to focus on making better and more efficient trade strategies rather than sitting in front of the computer and keep watching the fluctuating currency prices.

Human Weaknesses

There are few weaknesses that have strong impact on the human trading activity and a trader must pay attention to overcome these issues if he/she wants to be successful in FOREX trading. However, the critics of manual trading often use these human weaknesses as arguments and justification for the use of automated trading systems.

Greed

Greed is considered to be the biggest weakness of human beings or at least most of the humans on earth. This is often the case that a trader is getting handsome profit on a particular trade but he or she doesn't liquidate the position because of natural desire of earning more and more. But as the market is volatile, it quickly turns that favorable trade position into negative one and the trade who was in position to get reasonable profit on that trade few moments ago, starts facing threat of losing a huge amount of money. Such incidents happens again and again in FOREX trading thus incurring more and more loss to the traders on regular basis.

Fear

Without any doubt, every human on this earth have fear. In the world of trading, currency rate often move hundreds of points in very short time. Only a limited people are capable of predicting the direction in which market will move. All traders use some degree of leverage to trade, which enhances the profit or loss level up to 50 times or even 500 times. Although, leverage is a terrific feature but it also created a lot of fear in the heart of the trader because everybody knows that if market turns against them, it can cause extremely big losses. It is due to this pressure that people often take wrong decisions, especially in cases the market is going against them. In such situations, traders often go for the option of stop loss or cut loss quite early but after a short while, they starts regretting their decision.

Weariness

People can't work round the clock, without any rest or sleep. Everyone needs to take rest and have several other things or issues to manage, thus it's not possible to remain present and available all the time until the liquidation of the trade. This can also cause serious losses to the trader if market goes volatile in the absence of the trader.

Human's Strengths

Brain

The main strength of the human is brain. Humans can take into account all the happenings around the globe before making any trade related decision and therefore they can employ both technical and fundamental analysis to make a more perfect decision as far as FOREX trading is concerned.

Knowledge of Current Affairs

Humans have knowledge of current affairs and their effect on the FOREX trading. This knowledge enables humans to take much better decision regarding the future prices of the currencies.

Conclusion

Both automated EA robots and manual trading have several benefits and disadvantages. But without any doubt, manual trading is the proper way to go. The decisions of automated systems are based solely on technical analysis and the accuracy of their predictions or trade decisions varies from time to time. Automated systems or robots doesn't possess a brain similar to the one humans have thus they can't conduct fundamental analysis and therefore it is not possible for such systems to take into account the various big incidents that are taking place in various parts of the world that can have significant impact on the FOREX market.

How your pet dog learn?

Without proper training, your puppy will more likely to become a worst pet showing aggression, unwanted and unjustified gnawing with hyperactivity. You can make your dog a better pet by following the tips and facts mentioned below.

Always praise and reward your puppies whenever they act properly. This will encourage them to keep doing that particular act on a repeated basis and with the passage of time that act will become their regular habit. But make sure that your pet is aware of the fact that you liked a particular act and to give the reward in such a way your puppy loves. Without the encouragement and reward, your puppies will have no reason to keep doing the particular desirable act hence preventing them from being a better companion.

When you are walking with your dog, always give him the freedom to do whatever he wants to do, but whenever he tries to do an unwanted thing, pull the chain with a little jerk. Repeating this action few times will surely make your pet understand that the particular task is not good and after some time, your dog will stop attempting that act.

You must keep in mind that training your pet dog takes time and you need to incorporate a lot of patience to achieve your objective of training your dog according to your wish and requirement. Your dog will not be able to understand your command in a day or two. Therefore, you have to keep on encouraging the desirable and showing negative gesture on unwanted acts. Gradually you will start seeing consistent improvement in the behavior of your pet.

While training your dog, don't give him/her the food he or she loves because this will catch the attention of your pet and your dog will not be concentrating on your commands and gestures. Make sure your pet is attentive towards you when you are training him.

Don't forget to be kind and friendly to your pet. Remember, your dog understands the feeling of anger and irritation. So, always focus on developing good relationship with your pet, avoid impatience and keep in mind that the dog is not actually disobeying you, but he is not able to understand your command at the moment. But with the regular guidance and training, he will keep learning and improving.

Often, your pet dog starts begging for food whenever you are eating something. The best way to make your pet leave this habit is to keep your dog out of sight whenever you are eating something. Doing this right from the beginning will help a lot in preventing this problem.

Always issue orders or commands only once. Although keep on issuing orders until your pet follows it will help learn quickly, but you need to train your pet to act immediately on your first order and the only way to achieve this is to focus on making your pet respond after a single command.

Try to guess and make an idea what your puppy is going through. For example, if your dog is digging the backyard, this indicates that the pet is getting bored. Making such judgments will help training your pet better.

All the above-mentioned tips and techniques will surely help a lot in training your pet, but you need to actually implement these guidelines and spend some time to achieve the results. Patience, consistency, research and devotion will be the key to your success as a pet master.