How to use the Moving Average indicator?

A modern set of technical analysis tools for fix api trading on the Forex market is very diverse. Each year brings us new indicators, on the basis of which traders build their trading strategies. However, there is an indicator that is usually referred to the category of classical tools – all traders without exception know about it, it is used since the beginning of exchange trading on all types of markets. It’s about the Moving Average (MA) or moving average.

MA is an average price of a financial asset for a certain period. Averaging of any indicator is a popular technique used in statistics, economics, physics and other scientific disciplines. Averaging serves as a specific filter that allows you to isolate the trend from the market noise. It should be noted that MA is used in fix api trading as a stand-alone indicator, and as an integral part of more complex indicators of technical analysis.

In our time, several methods of MA calculating are used in trading:

  1. arithmetic moving average (MA);
  2. exponentially weighted moving average (EMA);
  3. linearly weighted moving average (WMA);
  4. smoothed moving average (SMMA).

Each average received by these methods has its own characteristics of reflecting the market dynamics, which makes it possible to effectively use and combine them in trading on the fix api Forex market. Such a set of МА calculation methods together with a wide choice of calculation period allows to form an almost unlimited number of variants of this technical analysis tool.

There are several ways to use MA:

  1. Trend determination – the tool allows you to visually show the current market trend for a selected trading instrument http://forexrobots.in/2017/05/25/long-vs-short-term-trading/
  2. Formation of resistance/support levels – a properly matched MA period allows the tool to be used as a resistance or support line for the price of the market asset;
  3. Formation of the level of setting the loss limiter for the market order (Stop Loss) – the use of MA as a resistance/support line allows the trader to form a level of placing the Stop Loss of the market order above or below the moving average;
  4. Determination of the point of trend change – the use of two MA with different periods in the fix api trading allows you to determine the moment of a break in the market trend and change the current trend to the opposite.

I listed only the most basic examples of using MA in the financial markets trading, but of course, this list is far from complete. MA is also used as a criterion for selecting assets in the portfolio trading, for filtering the trading signals and constructing other indicators of technical analysis. Trading systems based on several indicators in most cases also include some variants of MA. Especially good results are shown by the combinations of MA with RSI and Stochastic oscillators. Moving averages are used in identification of many popular patterns in graphical analysis of the markets.

Despite all its advantages, MA has two fundamental drawbacks, imposing significant restrictions on their use – lag and false signals. Indeed, this tool clearly demonstrates the features of the market price dynamics in history, but it is very late compared to the current price. In this case, the delay period increases with the increase in the average period. In addition, the use of MA as a technical analysis tool gives the trader too many false signals (https://1sforexsignals.com/) during the market flat period.

In conclusion, I would like to recall the popular market saying that moving averages earned more money for traders than all the other technical analysis tools taken together. Indeed, MA has been used for more than 100 years in all markets for all the trading instruments. MA is included in the sets of all trading platforms offered by the fix api forex brokers to their clients. This tool is able to help any trader to form his unique trading strategy, but to do this, they will need long hours of experimentation, search, trial and error.

Metatrader 4 is integrated trading solution

The most important tool for fix api trading, through which the trading operations on the financial market are actually concluded, is the trading platform. The trading terminal allows the trader both to conduct a comprehensive technical analysis of financial instruments, and conclude exchange transactions. For this purpose, many trading terminals have been developed, but the most popular one is the fix api MT4.

Metatrader 4 is integrated trading solution for both the broker and trader, which is most convenient in using trading conditions for cfd contracts, as well as the foreign exchange market. This terminal is called the “old-timer” of the market, since it has been functioning for more than 10 years and during this time has strongly strengthened its positions. That is why most brokers offer this software for free, because during the current period, many different auxiliary programs were created that synchronize with this software. This is one of the features of the trading terminal, but there are many others included in it:

  1. This software is primarily intended for trading cfd contracts and allows the traders to increase the number of different instruments.
  2. In the fix api MT4 trading terminal, the possibility of trading on a fractional contract is realized.
  3. Ability to use margin trading.
  4. A large list of graphical tools for analysis.
  5. Internal development environment – http://forexzzz.com/product/forex-zzz-lock-arbitrage/.
  6. Ability to use third-party software (as I wrote above) – http://forexrobotshub.com/2017/04/13/review-trading-software/.
  7. Ability to connect the terminal to the FiX protocol using fix api.

 

Non-Standard Money Management

Risk control plays an important role in shaping the future financial results. The existence of a trading strategy alone does not guarantee a positive financial result; therefore, it is necessary to develop additional effective parameters for managing the capital.

Averaging is also highlighted among the possible options for risk control as a non-standard option for risk and money management. I do not recommend to use this type as a basis for risk control, but nevertheless it will allow you to get out of the drawdown on a specific financial asset by opening additional transactions in the direction of a losing transaction. To do this, you need to understand the levels and logic of its work.

If we consider the example more specifically, then the averaging is used in the event that the trader has a loss on the transaction and in order not to close the loss and not to fix the position, he opens another deal in the same direction. Thus, he adds more volume to the unprofitable position and brings the break-even point closer to it. For example, when a trader has a loss on the EURGBP currency pair of 50 points and he predicts a spread of quotations to the previously opened side, he makes an additional deal in the same direction. Thus, the break-even point will be divided by two. When the quote demonstrates the dynamics of 25 points in the right direction, the fix api trader can close both deals: the first with a loss of 25 points, and the second with a profit of 25 points.

 

Methods of risk control in trading

Money management in the financial market plays an important role in shaping the future profitability of the fix api trading. Each exchange speculator should be aimed at keeping risks at a fixed level and try not to reach them. But nevertheless, they always present in trading and in the financial market only the fix api forex broker can earn stable and risk-free profit. We also need to manage our risks to ensure the safety of our funds and multiply them.

Methods of risk control in trading:

  1. Transaction risk: it is necessary to limit the losses in a particular trading operation, in order to understand how much will we lose in the event of incorrect forecast even before opening the position. This parameter also helps you to determine the volume of the position based on the risk. For this, there are auxiliary programs or calculators that display the volume of the deal in lots for fix api MT4.
  2. The risk for a certain time interval: I also recommend to set the maximum risk for a certain period of time. So, if you have reached maximum weekly losses, it is best to suspend trading, take a break and try again on Monday.
  3. Trailing stop: this option will allow you to improve the indicator more than once, based on the fact that it will always fix the guaranteed interest, which will allow you to leave the market even with a minimum profit in case of a sharp price turn.

These parameters are not new and unique, but they are able to take control of your risks and I recommend starting to apply them in your trading today!

 

High-frequency approach in trading

Fix api Latency Arbitrage is a high-frequency approach in trading, which consists in opening trading positions based on the exchange rate delays. This approach is implemented through trade both in the faster and in the slower broker. Thus, the trading robot conducts a constant analysis of price quotes and, in case of maximum delays, it commits a trading operation on the side of the slower broker towards the faster one. The logic of the automatic trading strategy consists in an implemented parameter, which is analyzed in an online mode. As soon as the price quotes for the same currency pair reach a certain (given) value in points, the robot will open the deal and close it after reaching the price marks that were for the asset on the side of the faster broker at the time of opening the transaction.

However, this simplicity of the algorithm has its hidden pitfalls, of which not every fix api trader knows:

  1. Most brokers prohibit the arbitrage principle of trading, so if the broker determines your trading style, he may not pay you the profit from the trading positions.
  2. Continuing the first point, the broker can easily identify this algorithm, because it also contains algorithms that automatically monitor such operations.
  3. Since all the operations on the transactions were carried out on the side of the slower broker, it is possible that the trader will go to a company that operates by the “kitchen” scheme. Therefore, he can lose not only his profit, but his capital as well.

Profitable Method Of News Based Trading

There are many different methods of trading in the financial market that can take profits even with the smallest price movements. There are also approaches that, on the contrary, are based on the fix api trading at the time of the most volatile phase of the market. This method of trading is the opening of trading positions when publishing important statistics that have the greatest impact on the price quotes. In the market, this type of trade is called news based trading.

News based trading is carried out for the purpose of quick earnings, because when new data enters the market, the exchange speculators rebuild their forecasts and open new trading positions that instantly cause increased volatility. Imagine a market boom when a lot of players compete for the same product. The same thing happens with the quotes of the financial asset in the fix api forex market. This is an excellent opportunity for a professional trader to earn at the moment, because the price for a short period of time can go up to 100 points.

For example, if the Central Bank changes its monetary policy and raises the interest rate, this indicates a toughening of the conditions. Thus, the supply of currency decreases, and the demand remains at the same level, which causes an increase in the asset value. For example, the decision to change the rate of the FED was marked by strengthening of the dollar compared to the US dollar by 80 points. This is an excellent yield potential for the trader. If he opened one lot at the fix api MT4 trading terminal (http://forexrobotshub.com/2017/12/12/mt4-ctrader/ ), he could earn approximately $800 in an hour (with a leverage of 1:100).

However, the scenario given above is very rare. Especially, if you conduct a chaotic fix api trading and do not have a special approach, because even in this trading method there is an algorithm of actions, about which I am going to tell you today.

Profitable method of news based trading

In order to conduct trading based on the news, each trader must be prepared for trading on this algorithm.

  1. Initially, you need to determine the news on which you plan to trade and see its dynamics on history. If this news does not cause more than 20 points of movement for a currency pair, then such a game is not worth the candle. If the expected indicator regularly shows 50-100 points of movement, then certainly it is worth choosing it for your trade.
  2. The second stage is to establish two pending orders: buy stop and sell stop. These two pending orders must be accompanied until the opening of the trading position. However, it is necessary to ensure that the transaction does not open on the basis of spread expansion or price noise on the threshold of data publication.
  3. After the news comes out, the quotes with a high probability will break one of the pending orders and you will have an open position for one “delay.” An order that is not open must be removed in order not to get into the lock.
  4. The open position is connected with further actions. It is your decision when to close a position. However, I would advise you to transfer almost immediately the transaction to the breakeven zone (to set a stop loss at the opening level) and include a trailing stop.

As you can see, this algorithm does not guarantee the fixation of absolutely all traffic after the news, but it allows you to fix a huge percentage of profitability in a single transaction and in the shortest time period. Moreover, the news based trading fits perfectly into the more standard trading systems for working in the fix api forex market and can be combined with other manual algorithms and automatic systems. Therefore, I recommend the fans of speculative trading and quick earnings to test the algorithm described above and which can be implemented in the form of a speculative trading robot (http://forexzzz.com/product/forex-zzz-lock-arbitrage/ ).

 

Trade with the help of automatic programs

The trading result directly depends on the methods of trading. If the exchange speculator does not have a tool for analysis that allows him to predict the future value of the asset, then there will be no positive financial result. I consider it a senseless waste of money to start trading in real funds without tool of analysis. This is a key mistake of the novices in the market, because almost everyone comes here for quick money and concludes chaotic transactions that only contribute to a fund loss. Therefore, to make the trading process profitable and able to demonstrate a positive result, each fix api trader must trade according to the trading system.

Everyone can find a ready-made description of trading systems on the Internet and start his acquaintance with the market with them. I advise you to initially try virtual means that you can get in the fix api MT4 trading terminal, and supplement the ready methods with his analysis forming an individual trading approach, because each trader is unique and not every trading system is suitable for all. Only after the first positive test results of this method, you can think about opening a trading account in the fix api forex broker.

There is also an alternative scenario – to use automatic trading programs in the form of robots (http://forexrobotshub.com/2018/01/30/a/ ), which will make transactions without the trader’s direct participation. With this approach, you cannot think about creating a trading strategy and spend time studying market patterns, because it will all be included in the robot, and the beginning speculator will turn into a full-fledged investor. Thus, a passive percentage of profit from trading in the fix api forex market is formed.

Undoubtedly, before you connect the program to a trading account, you need to test it on historical data, as well as pay attention to the statistical indicators. Only if the program already demonstrates profits on the existing trading accounts and its indicators do not cause increased risks, you can trust your capital to it. In other cases, I do not advise it.

If you have chosen a working algorithm, the trade with the help of automatic systems has a number of advantages:

  1. It allows you to save time on finding investment opportunities;
  2. It conducts permanent trade in the foreign exchange market (around the clock five days a week), which allows you not to miss the advantageous entry points;
  3. It controls risks, because the program sets a maximum loss parameter and risk and money management parameters are not violated;
  4. It controls the emotional background, as the robot works based on a specified algorithm and short-term losses will not affect its analysis of the transaction and financial assets;
  5. It allows formation of a highly profitable source of passive profit.

This is not a complete list of automatic programs and depends on each particular robot. However, this is the main basis, on which the manual trading of the novice speculators does not work, and the use of robots solves this problem. Moreover, the use of automatic algorithms can go in combination with manual trading and become a means to withhold the trading account from losses.

If you have your own system and conduct profitable trading, I still advise you to diversify it using an automatic approach. In this scenario, it is best to use another account in order that the logic of the trading robot in the fix api forex market is different from your system. This can be a completely different strategy or a more speculative algorithm, for example scalping or arbitration (http://forexzzz.com/product/forex-zzz-lock-arbitrage/ ). Therefore, automatic trading is suitable for both beginners and professional players on the financial market.

 

My own experience and insights in using forex trading robots

Most of those, who are trading on Forex market, have probably faced the so-called “missed deals” issue. If you are reading this article, it is likely that you have also suffered from it. I want to share my experience and an insight that helped me to dramatically increase profitability.

It is worth mentioning that I started trading on Forex with a tremendous wish to become “the great trader” and fully correspond to the image, which is imposed by television. However, the lack of financial resources and low level of the market development prevented me from achieving this goal. After a while, I finally designated a set of optimal conditions that fully satisfied my needs using my own experience in working with several trading brokers. However, even my deep knowledge, gained from the dozens of books did not bring me closer to the desired results. It took me at least half of a year to create a full-fledged profitable trading system.

I’ve got a powerful insight that I need not intervene into the working algorithm, but expand trading options in order to gain higher profit. Forex market is a unique platform, which works 7 days a week. However, I used only one third of its potential, as I traded only in the European session. It means that I traded 8 hours instead of 24 hours.

So, after familiarizing with the market for a while I upgraded my knowledge, but not the level of profit. Eventually, I decided to buy a forex robot in order to improve the performance.

It is not an easy task to choose a forex robot. There are paid and free versions of robots, which correspond various needs and strategies, both simple and complicated. The first lesson I learned on a forex market was that I have to invest in quality software in favor of my own deposit.

I started to check the review websites, which specialize on trading robots. You need a forex robot that would consist of the hundreds of algorithms for trading based on the setting parameters. So, spend some time wandering around the web to find some proper reviews on robots from traders.

Here is a list of helpful advice:

1. Read the reviews to understand the robot productivity and check the current clients’ results.

2. Find out how fast a particular robot can be optimized to your needs and keep in mind that the trading market is constantly changing. So, make sure you would be able to promptly adapt your robot to the actual market conditions.

3. Monitor the new robot models that appear on the market and compare their performance. Robots developing companies are constantly trying to develop more complicated systems and adaptive models. They want to provide the trader with the most successful tools.

It was a long and hard way of learning and mastering my trading skills before I found out that investing in software is the best way to avoid mistakes and problems in future. I have even lost my first deposit but still continued to study the trading market for 18 months. After that, I bought a couple of trading robots, tested them and picked the best one. Find out more about the automatic trading here: https://en.wikipedia.org/wiki/Foreign_exchange_autotrading

How to test a forex robot?

Today I would like to tell you how to test a forex robot, relying on the historical data and MetaTrader 4 software. First of all, you need to install the forex robot into the MT4 terminal. Then, set the number of bars in the history of quotes, which is based on the top “Service” menu and at a “Quotes Archive” sub category. After that choose a “Graphs” bar and enter a 100 000 000 number into the “Maximum set of bars in the history” and “Maximum set of bars on a page”. Press an OK button.

To get the quotes on the needed currency pair and test them you need to open a “Service” tab with a history of quotes or hit F2. Then choose a necessary pair with M1 time frame and press “Download” button. After a while the quotes would be downloaded, so you should restart your terminal. After that enter the archive and press the M1 time frame with the left mouse button, until the gray icon becomes yellow. To start the trading robot test open the strategy tester and press Ctrl+R. Then choose a currency pair, time frame and the type of a test. Finally, press the “Start” button and enjoy the results.

So, I tested numerous demo accounts and used various trading robots. I consider it as the main reason why I have become a successful trader. The second lesson, I’ve learned is that thoughtful preparation is a key to success. Learning more about forex market and mindfully investing you are protecting yourself from the losses.

 

What do you need to pay attention to when choosing a brokerage company?

The trader should be able to cope with all difficulties related to the financial market. These can be illogical assets’ movements, taking positions off the market due to the release of fundamental news or a change in monetary policy. In addition, the fix api forex brokerage company is setting additional spreads and markups for its customers. In order to decrease the pressure of these factors, each trader should know which broker to work with and which one should be avoided.

Today I am going to investigate this issue and identify how to choose the optimal broker for your fix api trading. Moreover, you would be able to find out if your current trading conditions supplier is a reliable partner for working in the financial market.

So, let me distinguish several key features, which the quality brokerage companies should have:

  1. The market spreads;
  2. The ability to select multiple trading terminals;
  3. The possibility of algorithmic trading;
  4. The access to fix api;
  5. The open information on the company’s website.

Let’s look at each of the types in more details.

The market spreads

This parameter indicates that the broker takes quotes from the market or a reliable liquidity provider. If you see a fixed percentage, it means that the broker takes a fixed percentage of your trade. If the spreads are the market ones, then at the time of the strong news, your positions will be opened at a fixed price or at least close to it. Or if there are already open positions, they will not be closed with greater risk than you asked. This indicator directly affects the financial result of the trade and the trader himself is not able to solve it (only using fix api).

The possibility to select several trading terminals

We are accustomed to the fact that if there is one broker, then there should be one terminal. However, this is far from true. You should have a choice of the most optimal software for fix api trading. The best option will be if the terminal is able to receive information from the market. It will be a significant advantage for the brokerage company. The fix api MT4 might suffice for somebody, but I reckon, that it is necessary to have the other options as well.

The possibility of the algorithmic trading

It is a well-known fact, that the robots are capable of trading stably with the minimum risk parameters and a large indicator of profitability (ссылка). If the broker prohibits this approach, then, firstly, it means that he is not able to pay the trader his profit, and secondly, the transactions do not overlap the market and are traded on the server of the brokerage company (the Dealing Desk system). This will immediately tell you that the broker is not reliable and it is better not to place the funds in such a company.

The access to fix api

If the brokerage company doesn’t give an asset to the fix protocol, it guarantees the quality of the company. On the other hand, if you are in doubt then you can independently trade via fix api on the side of the liquidity supplier. You can the trading robots for that. This solves several issues simultaneously.

The open information on the company’s website

The information such as: “our liquidity providers” or “our diplomas” does not tell the trader anything. Therefore, it is better if there is the information on legislation the broker relies on and where it is registered. This will tell you much more about the broker.

You can analyze your broker even now according to the list above. It is a good filter, which is worth using before placing the investment capital for the trading.

Resources to promote your trade

Each trader seeks a stable income in the financial market. We are ready to analyze the charts on a daily basis, to look for both fundamental and technical reasons for market weakening, and to share this information with our colleagues. However, I believe that you need to share this information not only with the other fix api traders, but also with potential investors.

If you have a working trading strategy at your disposal that brings a stable percentage of income, then you need to monetize and earn not only on exchange rate fluctuations, but also directly on the possibility of providing trading signals. We will consider today this opportunity and I will tell you some useful resources, where it can be implemented.

But first, I want to orient you for what it is for:

  1. If you promote your trading among the professional environment, you will be able to attract additional capital to your trade. We all know the standard conditions of the remote control (https://www.investopedia.com/articles/forex/09/using-forex-automation-software.asp ), in which you can take 2% for the fact of account management and 20% of the net profit. So, if you are able to increase your capital from $2000 to 5% a month and can attract $20,000, then your net profit will grow from $100 to $300 ($100 from the trade and $200 from the account management result). In this way, you can even get more from management than from your trading.
  2. Promotion of your trade will create a positive image in the professional environment of traders in the fix api forex market. You can gather around you like-minded people and followers; with whom you can build effective networking (http://forexrobotsreview.eu/2017/10/04/why-should-a-trader-track-the-trade-of-his-competitors/ ).
  3. Together with your trade, you can promote other auxiliary products. These can be paid consultations and a development of investment solutions directly under the client’s request. In this format, you can increase the profitability of your products and your expertise not only in the market situations.

As you can see, popularizing yourself as a trader allows you to significantly improve your financial results, and most importantly to diversify them.

Returning to the topic of resources, on which you can implement these opportunities about which I wrote above, you can refer the following platforms:

  1. Mql: by right, this is the largest and most popular resource on the Internet. Mql is a developer of fix api MT4 trading platforms and publication of the results is not difficult. However, the key drawback is the fact that the popularity of the resource provokes to set a higher price for the trading signals and some potential customers may simply not take advantage of this opportunity. Well, for a trader, this is still a platform with full statistical information on the trading results that allows you to be popularized among the trading community.
  2. 1sforexsignal: this is the youngest resource from my list. However, you should not miss the fact that the platform is intended for work namely in the fix api forex market. Concentration on one platform allows you to improve the quality of the trade signals delivery. Moreover, among the entire list on this resource, you can set a minimum subscription price of $1. Thus, the investor can test the trader’s trading style before entrusting him an investment capital.
  3. Fxsocialnet: the feature of this resource is the fact that the platform allows you to fully describe the algorithm of actions, see historical results of work, as well as current indicators. However, this is far from a key feature. This resource allows you to promote your algorithmic trading and attach a robot, which can be purchased directly from the site. This gives an opportunity to immediately demonstrate the results of the product and immediately sell it.

All these resources allow the trader to raise awareness in the market, and most importantly, they are tools for attraction of additional capital based on the trading results. It is clear that it is necessary first to create a working trading system, and only then to promote it. But for the future, this approach is an excellent option for increasing the profitability of your fix api trading activity.