The whole truth about trading signals

Many well-known brokers in the foreign exchange market offer an additional service in the form of providing trading signals to their clients. In addition to brokers, many well-known websites and blogs on the Internet provide trading signals (often carried out by traders in practice). Someone will provide trading signals free of charge and free of charge. Brokers are usually willing to provide signals provided that you open and fund your trading account. The Indexaco portal contains paid and free forecasts. They can be used in trading Buying trading signals shows the main indicator of the number of profitable transactions – the accuracy of the trend forecast.

What is a trading signal? This is information about which financial instrument and in which direction the position should be opened. It is assumed that the trading signal provider conducts serious analysis of the market that it serves.

What are trading signals for?

For example, if you find a very good signal provider, their signals can be very useful if you are a professional trader with several years of stable trading. By working on such signals, you will be able to make a profit at a rate comparable to the profit of this trader.

However, in this case it is not enough to follow the received signals accurately and consistently. In addition, strict adherence to a certain money management system is required. After all, no matter how accurate the received signals are, they must always have a certain margin of safety.

By margin of safety I mean the amount of trading capital as well as the percentage of risk imposed on each trade.

It should be recognized that in each trade half (50%) of the deposit is at risk, and it is a completely different matter to risk 2-5% of it. In the first case, after two unsuccessful trades in a row, you exit the game; in the second, you can relatively calmly survive a losing streak consisting of dozens of unprofitable positions.

Are there accurate trading signals?

What is transaction accuracy? Indeed, the entire stock trading process is based on forecasts, and forecasts cannot be accurate in all cases. However, a ratio of 60/40 is already considered good accuracy for traders (60% of profitable trades, 40% of unprofitable ones). Naturally, the ratio of take profit (TP) and stop loss (SL) levels for all 100% of transactions must simultaneously satisfy the conditions TP & gt; = sl.

So, although there are certainly signals of sufficient accuracy, it is very difficult to find suppliers of such signals. Moreover, even if you find such a supplier, you should be prepared for the fact that about half of all trades recommended by him will ultimately turn out to be unprofitable.

At some point, you have to be prepared for a series of losing trades to follow. And, of course, you should always need a SO-CALLED emergency exit from trading.

In contingency planning, this means a set of conditions or combination of situations that require you to immediately stop trading timeouts. For example, this can happen when a certain number of losing trades in a row or when trading capital decreases to a certain critical value.

However, here you should remember that competent management of your trading capital is only possible if the signals are provided to you by very good and sufficiently experienced traders for their stable earnings.

Experienced traders tend to always accumulate losses and therefore jump off the train early (left emergency) and risk missing out on many truly profitable trades. Therefore, compromises must be sought here. The more reason you have to trust the source of the trading signal (trader, website, etc.), the more you can push the boundaries of the emergency exit. And vice versa, if the source of the trading signal has not yet earned trust, you need to “jump up” without waiting for a strong drawdown.

A good option is to preliminary test the received trading signals on a demo account. At the same time, it takes time, not just a day or two, to create a statistically reliable picture. To do this, it is recommended to start with at least 100-200 transactions.

Automatic and manual trading using signals

Transactions can be made with signals in automatic and manual modes. The automatic mode involves installing special software that receives signals from selected suppliers and opens the corresponding positions without their participation. Due to the acceptable level of risk, only the initial installation of the program may be required (the size of the positions opened is determined in accordance with the capital management strategy).

In manual mode, you assume that you personally receive a signal (for example, in the form of an SMS message) and then make a decision to open or not open a position. In manual mode, the trading signal may be assumed by some analysts.

Fully automatic trading frees the trader from many routine actions, but has a number of disadvantages. Among them, for example.

• Interruptions due to poor Internet connection or random connection loss (this often happens even with the most stable Internet providers).
• Failure due to equipment malfunction (computers, servers);
• Farms due to errors in the software used. After all, it is far from a fact that the trading robot you use reacts equally well to all possible market conditions. Even with careful checking, it is almost impossible to provide for everything.

In this regard, manually following the received trading signals is more profitable, in this case, as well as manually following the received trading signals, taking into account the possibility of analysis and frankly stupid filtering of signals.

Analytics of trading signals

Receiving a specific signal from a supplier makes it possible to analyze it from a technical and/or basic analysis point of view. This type of analysis not only helps you eliminate obviously ridiculous trading signals, but also gives you the opportunity to grow professionally as a trader (and you won’t need trading advice in the future).

By the way, in this way you get a unique opportunity to “calculate” the signals for trading which trading strategies you will receive. After all, since reliable signal sources are unlikely to share much about your trading strategy, you have a good chance of analyzing each signal you receive individually in different strokes to get the big picture that they ultimately are.

You are independent of the source, since you created not only the signal, but also the trading strategy itself. It’s always better to learn how to “fish” yourself than to depend on the mood of a kind uncle who sometimes feeds you.

Paid or free trading signals

There are many paid and free trading signals. In addition, paying for information always guarantees its quality and reliability. Under the guise of a serious broker, trader or super-powerful forex blog, there are many enterprising fellows selling supposedly accurate trading signals.

This is one of the cases where indicators are given in the crosshairs, for example, website or blog promotion. In this case, the trader-blogger is directly interested in ensuring that the information offered reaches his readers. His reputation is at stake here, and he will consider whether to publish such content or not. In this case, the main goal is not to collect the maximum amount of money from subscribers, but to attract as many regular readers as possible to the Internet resource. Such signals can be trusted (trusted, but still verified).

It’s another matter when some would-be traders, after losing their deposit again, suddenly decide to retrain as a “trading guru”. The unspoken motto of this kind of young people is: if I don’t know how to trade, I’ll teach you (for money, of course, because you still need to earn money).

There are teachers who love to follow the fire trails, because the only result of communicating with them will be a significant relief for your wallet. No, not the only one. Moreover, such “grills” make money on their heads with bundles that are unnecessary to everyone, and worse than that, they are worse than those that are distorted into “knowledge.”

Can you trust trading signals?

There is one interesting story on this topic that happened in the West in the last century. One enterprising gentleman (let’s call him John) attracted a client base of 100 stock market traders. He then sent out free forecasts for N stocks (think of them as trading signals). Moreover, in half of the forecasts he promised a price increase and advised to buy these shares, and in the other half of the forecasts, on the contrary, he promised a decrease and advised to sell. After some time, one of the scenarios actually came true (the shares either rose in price or fell). Subsequently, John excluded from his client base the addresses of traders to whom he sent incorrect forecasts, and the remaining traders (who received correct forecasts) were again divided into two groups, all over again. Thus, as a result of these operations, he finally had the addresses of several traders who received only accurate forecasts. He then suggested that they buy another prediction for serious money (after all, it was worth it, and the previous recommendations were 100% correct!). It is clear that this last prediction was again taken out of thin air and went to the gullible Simpleton (who also shelled out a considerable amount of money). I draw my own conclusions: -.

Is it worth using trading signals?

So, should we use trading signals or not? Everyone has their own answer to this question. Many use trading signals out of sheer laziness. They want someone else to do all the work for them (to make them rich and happy). However, this doesn’t happen. No trader is completely safe from defeat or bankruptcy.

Of course, the decision is yours, but for myself, I can say this: I have never used trading signals and don’t particularly intend to. I have my own views on trading, but I don’t need advice. By the way, I never sell trading signals. Sharing them for free is a different matter (I might start such a project on this site soon).

Rely only on yourself. When you have money, you have many advisors and assistants; but when you don’t have enough money, there’s no one to help. Ultimately, you are completely and absolutely solely responsible for everything that happens in your life. Good luck, success, and stable profits!

Trading signals in the MT4 terminal

Not everyone knows about the Forex Metatrader4 (MT4) market, a well-known and popular trading terminal for working with and building services for trading signal providers. To access it, simply click on the “Signals” tab in the bottom handle of the terminal window.

Below is a sort of signal provider assessment with detailed information about each. This information is broken down into levels. On the first level, you can see:

• A thumbnail of the provider’s balance chart.
• The signal provider’s name and the funds they trade with (their personal funds).
• Profit growth rate and the period over which this growth occurred (in weeks).
• The number of subscribers and funds in the account associated with this signal source.
• The signal provider’s maximum drawdown and their profit factors**;
• Signal subscription cost.

**The profit factor (PF) value indicates how many times the total profit of all trades in the account exceeds their total loss (the higher the PF, the better).

Clicking on any of the trading signal sources presented will take you to the second level.

As you can see, the following parameters are shown here (in addition to those listed above) for the signal provider’s setup:

• Last trade time.
• Average number of trades per week.
• Average open position time.
• Brokers with whom you have an account.
• Leverage amount.
• Author’s name.

Here is a detailed chart of profit increases; below you will find summary information on transactions (trades).

[The History button takes you to the signal provider page on the official MQL5 website. Here you can see even more detailed information about him: his company name, his company name, his company name, his company name, his company name, his company name, his company name, his company name, his company name, his company name, his company name, his company name.

Next, let’s return to the supplier account information for trades presented in the MT4 terminal. In addition to the “Growth” tab, which shows a schedule of money being received into the account, there is another tab. There is also a tab.

• Means. Indicates the chart of changes in funds on the trading account.

• Balance Indicates the chart of changes in the balance on the trading account.

• Risk. Blueprints plus comprehensive information on the best and worst deals:

• Distribution. Here it is indicated with the help of which financial instruments and in what volume transactions are carried out. In addition, the ratio between their long and short positions is reflected.

• Review Here you can read real reviews from people who have connected their accounts to this source of trading signals.

• News All news about the trading signal provider is reflected here.

P. S.: As an example, one of the signal sources presented in the MT4 terminal was considered. It was chosen completely arbitrarily as a visual aid.