To Robot... Or Not To Robot

There are a number of ways to trade the forex. You can buy an ebook and go nuts trying to figure out what it's telling you. Then, you should probably supplement this with a video to watch someone tell you what's actually in the ebook.

Or, you can buy a robot with downloadable (is that a word?... I don't think so) software and fire it up to begin automated trading.

Regardless... you still need to hook up with a forex broker to actually handle the trade when it's placed. Your broker is the critter you bet against when you place a trade. Instead of commissions, they make money on the spread between the buy and sell price.

Let's say you want to trade the euro-dollar exchange. It looks like this: EUR/USD. If you buy this pair, you want the EUR to increase in value over the USD. If you sell this pair you want the EUR to decrease in value versus the USD.

At some point, you will end the transaction by reversing your position. In other words, if you originally bought the EUR/USD pair you would simply sell the pair in order to end the trade... hopefully by reaping a profit.

Forex robots are designed to execute trades automatically. Theoretically, you simply install the software on your computer... complete the recommended settings... and then sit back and watch the money roll in.

Sounds easy doesn't it?

Well, to a limited extent... it can be. But let's face it. If it were this easy to make money on a guaranteed basis we wouldn't be facing a depression right about now.

Don't expect a robot to make you wealthy. At best it will help you automate a reasonable number of successful trades over a period of time. More than likely, you will have to tweek the EA settings in order to preserve your gains.

The last thing in the world most people want is to be forced to stare at their computer screen for hours on end because they're afraid of losing trades. Well, unless you use the vendors (or brokers) server... you will only be effective with trading success while your computer is on. Sometimes this can be a problem.

Frankly, much of today's robotic software (referred to as EA or Expert Advisor) is sold through the ClickBank online retail outlet. Since they have an excellent refund policy it typically isn't dangerous to try out an EA for up to 60 days in order to see if you can not only figure out to make trades... but that those trades you do manage to close are truly profitable.

Just this year many new robots have hit the market.  Each one claims to be the best while presenting compelling evidence to back up their claims.

Before you get too excited about making some fast money... it's a good idea to take time to learn the lingo of forex trading.  All the major brokers have excellent forex tutorials at their respective web sites that can give you plenty of background and guidance.

The keys to successful trading are: patience... discipline... and sound risk management.