A commercial robot: the assistant or the enemy of the trader?
Category : Strategy
Every year, there are more and more automatic elements in the fix api trading that are designed to facilitate analysis and forecasting of asset values. It’s not just technical indicators, it’s about trading robots. This type of software is widely popular in the trader circles. According to the results of the U.S. Bureau of Statistics, almost 75% of the total market volume comes from trade experts.
But, despite the large number of trade robot fans, there are scepticists who trust only the manual trade. So who’s right? Is robot an important auxiliary tool? I’ll try to answer that question today.
A trade robot is an algorithmic trade strategy that is based on automatic analysis of quotes, closing purchases and fix api forex market sales transactions and regulating the manager’s capital.
As you can see from the description, theoretically, the robot must follow the algorithm that is inherent in it. If you have a trade strategy that you can just write on a sequence sheet, why don’t you rewrite the sequence as code and automate your fix api trading process?
That is the basis of the problem. There are a huge number of formalized trading systems that are not so easy to write down. For example, it is very difficult to implement a merchant robot that would be very precise in displaying levels of support and resistance (read the link – http://www.babypips.com/school/elementary/support-and-resistance-levels/support-and-resistance.html) in different timeframes, or drew a wave mark on the graph. Such strategies require the intervention of the trader and his expert knowledge.
So if you have some of the elements in your strategy that are hard to explain in your code, the robot may start giving false signals and trade incorrectly. Of course, optimizing the advisor will help solve the problem, but you’re probably already in the group of those skeptics.
Based on this, you can highlight several key issues when creating a merchant robot:
- Formalized algorithms that are difficult to program;
- Trade code errors;
- Working not on all intervals;
- Working not on all instruments;
- Lack of comprehensive testing of the algorithm before entering the real market.
I personally use a procedural approach in my trade, despite the fact that I use the levels of support/resistance and the Elliot wave mark. The robot displays the presence of trade signals and Fibo levels, compares them with the technical indicator values (MA and Bollinger Bands), and displays the signal, and I compare them to the market phase and open trade transactions. Additionally I have a trade robot that is based on my own approach and that trades in the fix api market on small timeframes. A kind of scalper. This allows me to use both long-term and short-term trading using my capital, which in turn diversifies the risks.
There are a large number of systems that can be automated. If there are those that are hard to automate, and those that you can turn into code a bit easier.
For example, a trade robot based on the fix api arbitration trading – http://www.forexzzz.com/product/forex-zzz-lock-arbitrage/. The algorithm is fairly straightforward: the trading robot compares the value of the quotes of the same currency pair, but on different stock sites. In the event of an anomaly, the robot opens two positions at the same time in different sites towards the spread. When quotations are back at the normative values, the transactions are closed and the result is recorded, which will be the exchange rate difference. In this way, it allows you to record minimum revenue at zero risk.
To summarize, I want to point out that virtually any system can be automated. It is important to determine how much it can be converted into code. And if you’re using the system in manual mode, why not turn it into a trading robot?