The Forex market is huge. It has thousands of participants in different shades and in different cuts. There are institutional investors such as hedge, mutual, and pension funds with their billions. Also, there are retail participants with their modest capitals, too.
This market has grown to become wildly popular over the years partly because of its perceived lucrativeness. In fact, many will recommend that if you want to get rich quickly, go into Forex. But how true is that?
Sadly, available statistical data say otherwise. 9 out of every 10 retail Forex traders are losers. Many of those will quit. Many have quit. The Forex market, it turns out, is not as lucrative as thought — at least, for many of its participants.
The unfortunate thing is: if you too do not take specific precautions, you will end up becoming one of those who Forex has burned. Read on to find out more about a tool that does not only help you to mitigate your risks but also maximize your gains.
Signals: What are They?
Signals exist for one thing: to help traders get more out of their trades. It is a sad fact that more traders lose their hard-earned money in the Forex market than in any other financial market. It does not have to be. Perhaps, that explains why signals have become particularly associated with the Forex market.
Forex signals recommend the right entry and exit points to trade a particular currency pair that will result in the best returns for their users. Usually, they are developed by dedicated companies which have grown and maintained strong client bases over many years.
The working idea of Forex signals is to help struggling traders relinquish all their analyses to a human expert or software that will then identify tradable set-ups, and even in some cases, execute those opportunities for them. Forex signals are sent out to their subscribers immediately opportunities present themselves.
Because of their time sensitiveness, it is important that signals are delivered almost instantaneously to their subscribers. Therefore, they are often sent in via real-time channels such as SMS, RSS feed, and social medial updates.
Whichever the means by which the signals are communicated to their potential users, what is important is that they are applied on time.
Different Types of Forex Signals
Forex signals have different types. However, the classification depends on the criteria being considered. For example, Forex signals have been typified based on the way by which they are generated and the agent that generates them.
Consequently, we have manual and automated signals. We also have fundamental-based and technical-based ones. Manual signals, as the name suggests, are created through human instrumentality. That is, human analysts, who are usually experienced traders, identify them and communicate them to other traders.
The automated signals, as suggested by the name also, are generated by software which have been programmed to analyze and use historical price movements to identify the next probable market moves. The greatest advantage of automated signals is that they help to eliminate the risk of emotional trading. However, they are not flexible enough to respond easily to changing market conditions such as drastic market volatility resulting.
Forex signals, no matter the type, usually come at a fee. Nevertheless, there are providers that do not charge any fee and are interested only in using them to build loyal customer bases.
Why You Should Use Forex Signals
Forex signals. Why use them? While you might have been able to identify some of the reasons for using them by now, there are really many other potential benefits that the right use of Forex signals holds for your trading. In fact, your trading toolkit is not complete if you do not integrate signals into it.
- Forex signals save time: Time is money, they say. You want to keep your trading career as just a part of a healthy life. You want to have time to take your son for his baseball training and your daughter for her ballerina practice. The sad news, however, is that: analyzing takes time! It can rob you of the time to do all these. But do not give up. A standard signal service, by eliminating the analysis burden, can help you to have more time to spend with your family and yourself.
- Forex signals help you to diversify: Forex signals can help you to diversify your trading. You could be trading other asset classes (e.g. equities or commodities) already, and you are thinking of venturing into Forex. But how do you find the time to analyze the currency pairs while still continuing with your already-established instrument? By using signals.
- They can be educative: Some providers incorporate commentaries into their signals. Signals of this nature can, therefore, help you to learn more about the bases for decision making in Forex trading. They can, to some extent, also help you sharpen your analysis skills, while not taking too much of your time.
So, using a signal service is advised. But you should use a good one. 1000pip Builder has been providing top-notch signals for many years, and you should become their customer too by signing up for a membership with them here.