In the era of total computerization and the worldwide expansion of the Internet, trading robots are one of the key tools in the arsenal of any trader. In this article, you will learn what they are, how they are used, and what are the benefits of using them. As a bonus, the text will contain descriptions of the most efficient robots that consistently show high results over a long distance. So, first things first.
What is a trading robot, the principle of the adviser
In specialized literature, trading is defined as the process of buying and selling financial assets for the purpose of making a profit, diversifying risks, or protecting assets. It can be carried out in manual, automatic or semi-automatic mode. In the first case, the trader analyzes the market himself, opens deals, accompanies orders, fixes profit or loss. In the second and third – uses bots.
A robot or advisor is a software that partially or completely performs the functions of a trader by interacting with a trading terminal (for example, with QUIK or MT4) or a client-server software interface through an API. Bots are designed not only to simplify or facilitate the performance of routine tasks, but also to make trading much more efficient. The program is not subject to emotional fluctuations, fatigue and doubts, it works out the inherent algorithm without being tied to external factors.
Bots are not only capable of opening/closing orders when certain conditions arise, they can independently track technical and graphical indicators, analyze, for example, trading volumes, calculate profits and risks, accompany a transaction using a trailing stop, average or open an opposite position, and do a lot more useful things. It is important to note that the program performs its functions many times faster than the most gifted and experienced trader, which is also undoubtedly an obvious advantage.
Algorithmic trading and trading robots
Effective professional trading in the stock, currency, commodity, futures and other markets involves working according to a certain algorithm. Every successful trader has a trading system within which he makes transactions. This is algorithmic trading. Trading bots are created on the basis of such algorithms – sets of rules and restrictions that are put into the program at the stage of writing the code.
Automatic trading robot
Completely autonomous system that does not require human participation in the trading process. The trader sets the necessary parameters, turns on the bot and periodically checks the results of its activity, as well as the stability of the work. If necessary, adjustments are made, control is carried out at will.
Trading on the adviser’s signal
Unlike the previous variation, Expert Advisors are designed for trading in semi-automatic mode. This means that the software analyzes the charts and signals the appearance of trading opportunities, but the decision to open a transaction is made by a person. All manipulations with the terminal necessary for opening, maintaining and closing an order are also performed in manual mode.
Robot for online trading
Hosted remotely on VPS servers. A program installed on a computer may fail due to an unstable connection, a machine breakdown, or a simple power outage. Specialized DATA centers are protected from such precedents, so the operation of robots for online trading is considered the most stable and reliable. We recomend to use Vultr.com service.
Advisors for trading stocks, options and futures
Working with derivative financial instruments, such as options and futures contracts, has a slightly different specificity than, for example, stock trading. But both in the first and in the second case, bots can be used equally successfully. Programs differ in algorithms and settings, but in both cases they give the desired result, both in semi-automatic and automatic modes.
AI trading bots
Artificial intelligence and neural networks take an active part in modern stock trading. The key difference from classical algorithmic robots is learning. Bots created on the basis of AI can operate a deposit not only within the framework of a trading system developed by a trader, but also optimize it and even create their own.
Mobile trading bots
Over the past 5 years, the share of traders who prefer mobile devices to regular computers has increased by more than 17 times. This state of affairs prompted developers to create applications adapted for trading through robots. They have the same functionality as the desktop or cloud versions, but differ from them in the specifics of coding and usability. As a rule, they are created for a specific operating system – trading robots for Android are not compatible with iOs and vice versa.
Classification of advisers
The software industry offers a large number of trading robots. Below are the key varieties in the context of the principle of performing transactions in the terminal.
Indicator
As the name implies, positions are opened and closed based on indicator signals within the chosen trading system. Usually, this is a combination of signals from several indicators (for example, moving averages crossover, divergence on oscillators, trading volumes for the instrument, channel breakout, etc.).
Non-indicator
Quite an extensive group of bots. These include Expert Advisors that use chart and candlestick patterns, strong support/resistance price levels, mathematical models, movements caused by the fundamental background, and price behavior patterns.
News
They use the breakdown of the time corridor at the time of the publication of significant macroeconomic indicators or after the appearance of important news, they trade rollbacks after impulses. They skillfully place limit orders, work effectively in both directions, and are able to accompany open positions themselves by means of trail stops.
Arbitration
They profit from the difference in the value of one asset on different platforms or in relation to other instruments. Such bots not only buy cheaper and sell more expensive, but also calculate the spread themselves, take into account commissions and can determine the direction of the trend on the selected timeframe to minimize risks.
Averaging
They open deals in any direction, regardless of the trend, fundamental background and technical indicators. If the quotes price goes in the right direction, they take profit, if not, they add positions. One of the most profitable robots, but also, perhaps, the most risky – protracted recoilless movements often take them out of the market.
Multicurrency
They operate with several currency pairs or cryptocurrencies within one platform. A larger number of instruments provides a greater number of transactions and, accordingly, a greater profit. In addition, well-designed Expert Advisors using the principle of correlation and de-correlation perfectly diversify risks.
Trending
The trend is determined in various ways, from breaking the highs/lows of daily candles to using indicators, trendlines, volatility, or combinations thereof. The best samples are able not only to accurately identify the emergence of market trends, they take the entire movement in its entirety, and also add positions on pullbacks. Thus, it turns out to take the maximum number of points from each transaction.
Flat
Out of competition when the market is in the accumulation phase and the price moves in a narrow range. They make a lot of transactions, while taking the minimum number of points. The principle of operation is mainly based on the readings of channel indicators. With proper assembly and proper optimization, they have one of the most attractive risk-to-reward ratios.
Scalping
The activity of scalpers is characterized by a high frequency of transactions, a short period of holding a position and, as a rule, its insignificant volume. Scalping robots can perform dozens and even hundreds of transactions during the day. The principle of operation is the most diverse: from simple mathematical models to complex combined TS based on a pool of indicators and graphic patterns.
Cryptocurrency trading robots
Cryptobots are at their peak today, as crypto is perhaps the most hype direction in trading. This is natural, because only on it you can make the notorious X’s literally every day. Expert Advisors for crypto trading are designed specifically to do it stably and as safely as possible.
Cryptocurrency signal indicator
Purely technically, the Bitcoin price chart is no different from the chart of stock quotes or currency pairs. Therefore, for the technical analysis of altcoins or stablecoins, the same indicators are used as in conservative trading.
Signal indicators for cryptocurrencies are lagging (various kinds of trend indicators, such as moving average) and leading (classic oscillators – MACD, stochastic, RSI). The work of indicators for trading cryptocurrencies is based on mathematical models that describe market processes. The more complex and diverse they are, the more accurate the signals.
Bitcoin forecast indicator
Professional traders with sufficient practical experience can build an effective trading system using standard indicators available in any terminal: Moving Average, Ichimoku Cloud, volume indicator, relative strength index RSI. Such a system will work stably and regularly make a profit, including on top sites such as Binance and Coinbase. A beginner, due to the lack of a deep understanding of market processes and practical experience, is unlikely to be able to consistently earn money even with the most advanced indicators and advisors created on the basis of neural networks. In this case, it is much more advisable to turn to professionals and purchase a reliable tool for highly profitable trading.
Buy a trading robot
The software industry offers a large number of trading robots. It can be difficult for an uninitiated layman to make the right choice among such a variety. Against this background, we bring to your attention the top 3 trading advisors: FXMath Daily Trader, Equilibrium, New Hope Trader. The latter should be considered in more detail, because it is he who has been confidently taking the Grand Prix at the most prestigious international competitions for the last two years. Here are a few reasons to choose New Hope Trader:
● Trade in plus in 99% of trades.
● Up to 100% profit from the deposit per day.
● Response to signal within 1 millisecond.
● Fine risk management with the possibility of hedging.
● Effectively counteracts blocking of brokers.
● Simultaneous trading on different accounts and terminals.
● Allows you to trade lots with a volume of 0.01.
Based on the facts, New Hope Trader is the best Forex trading robot. Choose one of four trading strategies and see for yourself!