Forex Trading Robots Explained
Best Forex Trading Bot in 2024 — 1000pip Climber
Top Forex Trading Bots in 2024:
1000pip Climber — best trading bot at all
Roboforex — best trading EA builder for beginners
Flex — best EA for steady results
Alfa Scalper — best scalping bot
Forex Gump — best robot for multi-currency strategies
Every day, approximately $5 trillion worth of currency is traded in the forex market, averaging about $220 billion every hour. Forex trading has been a goldmine for many across the world, with moguls like George Soros making up to $1 billion dollars in a single day. While $1 billion dollars might be a bit far-fetched for the average trader, you can still earn a decent living trading currency pairs on the forex market.
If you've ever traded forex, then you understand just how cumbersome the entire process can be. Everything from analyzing markets, implementing strategies, and keeping up with charts can be all too overwhelming for the typical forex trader. But that's where forex bots come in.
Forex bots are special software that generate forex signals and execute trades on behalf of the trader. They help lessen the workload and help traders reap considerable profits without working half as hard. So, what are trading bots, and do they really work? Well, keep reading to find out.
What Are Forex Robots?
A forex robot, or simply forex bot, is a software application that is used to automate forex trading. These bots can be programmed to execute trades based on a variety of factors, including time, price, and volatility. They'll help you decide when to buy and sell a given currency pair, making them incredibly helpful for traders who don't have the time or expertise to trade manually.
By automating the process, forex robots can take the emotion out of trading and help to make more informed and rational decisions. However, not all forex robots achieve their core mandate. That's why it's important to find a reputable one with a good track record. Most of the popular forex bots are built around the Metatrader platform, used by millions of forex traders across the globe.
What Are the Pros of Forex Bots?
There's a reason why forex bots are so popular in the forex trading community. It's because they work. Here are a couple of pros of forex bots for trading forex.
Saves Time
By automating all the processes involved in forex trading, from analyzing charts to executing trades, forex bots free up your time so that you can focus on other important things. You can even use the free time to refine your forex trading skills or get familiar with current world events that may impact your trades
Emotionless Trading
Forex trading is a game of numbers where whims and emotions could potentially derail your trades. Automating your forex trades means taking the emotion out the entire process. Instead, decisions are based on predetermined rules and conditions, ensuring that you always know when to buy or sell a currency pair.
They Can Work for 24 Hours
The forex market is open 24 hours a day, five days a week. That means if you're manually trading forex, you need to be glued to your computer or mobile device at all times to ensure that you don't miss any lucrative trading opportunities. However, with forex bots, you can set your trade parameters and go about your usual activities. Not to mention it's physically impossible to trade for a full 24 hours every day.
Can be Tweaked to Meet Traders' Needs
The best part about letting a program run your trades is that you can tweak them to meet your desired needs. If something doesn't work, alter the code to correct the issue. You can consistently refine your trading bot to ensure that it works perfectly for you.
Super-Efficient
Forex bots can process large amounts of data in a relatively short amount of time. They're able to take into account all the forex market conditions and make split-second decisions, which is something that humans simply cannot do. What's more, these software programs can multitask, taking account different aspects of the forex market to execute successful trades
What Are the Cons of Forex Bots?
Of course, no tool is perfect, and forex bots are no exception. While they can help trades make huge profits, the same traders may also incur large losses. Here are a few cons of forex bots.
High Initial Investment Costs
While there are free forex bots available, the best ones usually come with a hefty price tag. Not to mention, you'll need to invest in a forex bot compatible trading platform like Metatrader, which can also be quite expensive. If you want a good fore robot that can reap massive profits, you better be prepared to dog deep into your pockets.
They're Only as Good as the Coder
A forex bot is a set of coded instructions that direct a trading API. This means using a forex bot is leaving your trades at the mercy of a coder. These bots are only as good as the people who coded them, meaning you need to find a reputable forex bot coder with a good track record. In fact, seasoned forex traders learn coding to craft the perfect codes for their bots.
No Guaranteed Returns
Despite what some forex bot developers may claim, there are no guaranteed returns when trading forex with bots. In fact, you could even end up making substantial losses if you're not careful. Remember, forex trading is a risky venture and there's no such thing as easy money. It's either you invest in a high-quality forex bot or lose your hard-earned cash.
What Are the Main Types of Forex Bots?
As mentioned earlier, not all forex bots are made equal. In fact, the term "forex bot" describes a cluster term for a series of algorithmic functions designed to execute trades in the forex market. Here are the main types of forex bots.
Expert Advisors (EA)
An expert advisor is a forex bot that's been programmed to trade based on certain conditions and parameters. These conditions and parameters go hand-in-hand with your trading strategy and only trade based on your predetermined criteria, making you the advisor. EA forex bots are usually coded in MQL, which is a proprietary coding language created by MetaQuotes.
Arbitrage Bots
Arbitration forex bots aim to take advantage of pricing inefficiencies in the forex market. For example, if there's a price difference in the same currency pair on different forex brokers, an arbitrage forex bot will buy on the cheaper platform and sell on the more expensive one to make a profit.
Moving Average Bots
Moving average forex bots trade based on a simple moving average crossover strategy. This is where two moving averages with different time periods are used to signal buy and sell conditions. For example, if the 50-period moving average crosses above the 200-period moving average, it signals that an uptrend might be forming, prompting a buy order.
Scalping Bots
Scalping forex bots are designed to scalp the market for small profits. This is done by opening and closing multiple trades within a day with tight stop-losses and take-profits. The process is extremely tiresome if done manually, making these bots life saver for scalp traders.
News Trading Bots
As the name suggests, news trading forex bots trade based on economic news releases. These forex bots usually have an in-built news calendar that keeps track of upcoming economic news releases. Once a forex bot detects an impending news release, it either opens or closes a trade based on the expected impact of the news.
How to trade Forex News?Do Forex Trading Bots Really Work?
There's always the question of whether forex bots can really make huge profits for forex traders. There always seems to be two camps; one heavily in support of forex bots and another dismissing them as a sham. So, do forex robots work?
The answer is yes and no, because it really depends on the forex bot you settle for. If you choose a high-quality forex bot with well-vetted code, then there's a good chance it'll make profits for you. However, if you go for a forex bot with shoddy code, then you might as well be throwing your money down the drain.
Investors and traders have lost a ton of money trading with free robots that "work." On the other hand, software developers and hobby traders have made a killing by coding their own forex bots.
So, how do you know which bots work and which don't? The best way to learn the effectiveness of a forex robot is by checking out online reviews from previous users. Only check out authority sites because some developers use forums to taint their competitor's image.
How to Choose a Forex Bot That Generates Returns
With the plethora of robots available these days, picking the right one can be a huge challenge. Here are a few tips for picking the best forex robot for your trading.
Learn the Basics of Forex Bots
If you want to pick the best forex bot, then you need to have a firm understanding of how they work. Not all forex bots are created equal, and each type has its own strengths and weaknesses. By understanding the different types of forex bots, you'll be able to make a more informed decision on which one is right for you.
Check the Robot's Testing History
The testing history of a forex robot speaks volumes about its effectiveness in executing profitable trades. Be sure to check the bot's testing history, particularly its backtesting and live trading results.
Backtesting is a process where the forex bot is tested on historical data to see how it would have performed under different market conditions. On the other hand, live trading results are proof that the forex bot is currently effective in trading the forex market.
Look for a forex bot that has a long and consistent testing history. You should also be able to easily find this information on the forex robot's website or through third-party websites.
Check Online Ratings and Reviews
The bot ratings and reviews should give you a good idea about a forex bot's effectiveness. You'll find different ratings for different criteria in most authority sites. Some of these criteria include things like ease of use, customer support, features, and effectiveness.
Don't just take the forex bot website's word for it; be sure to check out independent user reviews as well. These will give you an insight into how easy the forex bot is to use and whether it's really effective in trading forex. But, as we've already mentioned, beware of fake reviews that are posted by the forex bot's developers to boost its image or taint its competitor's image.
Check the Statistics (Win Rate and Risk-Reward Ratio)
When looking at the performance statistics of a forex bot, always check the win rate and risk-reward ratio. The forex bot's win rate is simply the percentage of trades that it has won over a period of time.
The risk-reward ratio, on the other hand, is a measure of how much profit you can expect to make for every dollar you're willing to risk.
For example, a forex bot with a win rate of 80% and a risk-reward ratio of would mean that for every $100 you're willing to risk, you can expect to make a profit of $80. Of course, no forex bot has a 100%-win rate, so don't be discouraged if you see a forex bot with a slightly lower win rate.
Forex Bot's Fees (Check the Fees)
As mentioned earlier, high yielding forex robots cost a pretty penny. It's important to check the forex bot's fees before signing up to know whether you can afford it. Some forex bots charge a monthly fee, while others take a percentage of your profits.
Some forex bots offer a free trial so you can test out the features and effectiveness of the bot before committing to it. This is a great way to see whether the forex bot is really worth your money. Of course, you should never settle for the cheapest bot you can find; it will only drain your cash.
Best Forex Trading Bots for 2024
We understand how finding the best forex bot from the plethora of options can be overwhelming. That's why we've compiled this list of five of the best forex trading robots for your consideration. They include.
1000pip Climber
1000pip Climber EA is the leading Forex robot and the highest rated EA on TrustPilot, with a rating of almost 10/10. Users of this EA have been particularly impressed with the very high yield in both trending and range bound markets.
The impressive performance has also been independently verified by Myfxbook.com, one of the largest providers of automated copy trading systems, so you can be particularly confident in the quality of this EA.
This EA is well suited to beginners because it is easy to install and use, and comes with full support from the developer of the system. In addition, the 1000pip Climber EA has no minimum deposit and you can use any leverage value.
This EA is a great choice for traders that want an easy to use, class leading robot with outstanding performance. At the moment, you can take advantage of the current flash sale – the price of 1000pip Climber is reduced from $299 to only $97.
Roboforex
Roboforex isn't exactly a forex robot in itself, but a platform that lets you design your own bot to trade with. Don't worry, you don't need to learn programming to use Roboforex. That's because the platform provides you with a wide range of forex trading strategies that you can use to design your forex bot.
But if you're feeling adventurous, you can always try your hand at programming and designing your forex bot from scratch. The best part is that it's free to use; you only pay when you make a trade. So, if you're looking for a forex bot that won't cost you an arm and a leg, Roboforex is definitely worth checking out.
Flex (Overall Best Expert Advisor)
Flex is an expert advisor not popular for its ability to consistently deliver solid results. This is quite rare with forex bots, and that's why it earned the top spot on our list.
Flex is also easy to use and can be set up in minutes. The forex bot has a wide range of features that make it one of the most versatile forex bots on the market. Some of these features include things like a news filter, trailing stop loss, and take profit. At only $20 a week, the bot certainly won't break the bank, and you'll get a considerable return on your investment.
Alfa Scalper (Best Scalping Bot)
Alfa Scalper
Alfa Scalper is one of the handful of bots on the forex market designed specifically for scalping. The bot charges a one-time fee of $147, which isn't too steep for what it offers.
Some of the features that make Alfa Scalper great for scalping include a stop loss and take profit feature to minimize your losses and an adjustable trailing stop. The forex bot is also equipped with an advanced money management system to help you maximize your profits.
However, you'll need consistent high-speed internet to make the most of Alfa Scalper. Latency delays could lay waste to all your trades.
Forex Gump
Forex Gump is a forex robot that's known for its ease of use. The forex bot is designed for beginners and can be set up in minutes. It comes with a wide range of features, including things like take profit, stop loss, and trailing stop.
One thing to note is that Forex Gump doesn't have a very high win rate. However, it more than makes up for this with its low drawdown and affordable price. At only $149, Forex Gump is one of the most affordable forex bots on our list.
Fortnite (Best Bot for Fast Markets)
Fast markets are a forex trader's worst nightmare. But if you're hell-bent on trading in them, you'll need a forex bot that can keep up. Fortnite is designed for fast markets and is equipped with some of the quickest trade execution speeds on the market.
The forex bot also has a feature that allows you to trade multiple times per second. This is perfect for those who want to take advantage of every opportunity in the market, no matter how small.
The only drawback of Fortnite is its price tag; at $499 per month, it's one of the most expensive forex bots on the market. But if you can afford it, the forex bot is definitely worth the investment.
How to Set Up a Free Forex Robot and Start Trading
Although we wouldn't recommend using a free forex robot, it doesn't hurt to try. After all, it's free. Here's how you can set up a free forex robot and trade with it.
Step 1: Find a forex broker that offers MT or EAs, like AvaTrade, XM, or FXCM.
Avatrade account opening instructions
Step 2: Download the forex bot of your choice from the broker's website for free.
Step 3: Attach the forex bot to your trading account.
Step 4: Set up the forex bot according to your preferences.
Step 5: Start trading!
It's worth noting that free forex robots usually come with certain limitations. For example, they might only work on a demo account or have limited functionality. Nevertheless, it's still a great way to get started with forex trading bots without spending any money.
How to Build Forex Robots for Beginners (Without Programming)
There's nothing stopping you from building your own forex bot to execute profitable tardes, so why not go for it. If you're a beginner, don't worry. Building forex robots is actually quite simple and can be done in a few steps.
Export Historical Data for Trading Assets: The first step is to get your hands on some data. You'll need historical forex data to train your forex bot and test its accuracy. Fortunately, most forex brokers offer this data for free.
Create a Handful of Trading Strategies: Once you have the data, it's time to start creating your trading strategies. You can do this by using a forex bot builder or by coding them yourself. If you're using a forex bot builder, simply input the parameters of your strategies and let the forex bot builder do its job.
Pick the Best-Performing Strategies: After you've created a few forex trading strategies, it's time to test them out. After testing, pick out the promising strategies and discard the rest.
Export the winning strategies: The forex bot builder will then generate the code for your forex robot based on the winning strategies you selected.
Attach the Forex Bot to Your Trading Account and Start Trading: The final step is to simply attach your forex bot to your trading account and start profiting!
How to Write a Trading Robot?5 Tips for Using Forex Robots
Forex bot can be real cash cows if you use them the right way. Here are a couple of tips for making the most of your forex bots.
Lower your expectations: Don't expect forex bots to make you an overnight millionaire. Just like with any other trading method, forex bots take time to learn and master. Plus, there's always the possibility of losing money.
Use the trial version first: Many forex brokers offer a free trial version of their forex bots. This is a great way to test out the forex bot before committing to it.
Never use default trading parameters: The forex bot builder will usually provide you with default trading parameters. These are not always optimal and can lead to losses. Instead, tweak the trading parameters until you find a combination that works for you.
Don't over-optimize: Over-optimizing is when you try to get the forex bot to work too well on historical data. This can lead to overfitting, which is when the forex bot fails to perform well on live data. To avoid this, always test your forex bot on live data before using it for real trading.
Keep a close watch on your bots: Despite being automated, bots still need some degree of monitoring. Keep a keen eye on your forex bot's performance and make sure to intervene if something goes wrong.
By following these tips, you can greatly increase your chances of success with forex trading bots. Just remember to stay patient and never give up! Good luck.
Summary
Hopefully, the information above has given you a firm understanding of what forex robots are and whether they actually work. Don't skimp on the forex bot you settle for if you want to make a killing with your trades. Remember, although forex bots work great, they can only supplement your trading efforts. You still have to put in some degree of work to make a killing with forex robots.
There's a lot more from where that came from. Check out the other posts on the site for more informative reads.
FAQs
Are forex robots legal?
Yes, forex robots are legal and are regulated by various financial bodies such as the National Futures Association (NFA) and the Commodity Futures Trading Commission (CFTC).
Can I code my own forex bot?
Yes, forex bots can be coded by anyone with some basic coding knowledge. However, it's usually easier and more effective to use a forex bot builder.
Do forex robots work?
Forex robots have the potential to work great if used correctly. However, there's always the possibility of losses, so don't expect forex robots to make you an overnight millionaire.
How much do forex robots cost?
Forex robots can cost anywhere from absolutely nothing to well over $1,000. It all depends on the features and complexity of the forex bot. Generally speaking, the more expensive forex bots tend to be more effective.
Team that worked on the article
Oleg Tkachenko is an economic analyst and risk manager having more than 14 years of experience in working with systemically important banks, investment companies, and analytical platforms. He has been a Traders Union analyst since 2018. His primary specialties are analysis and prediction of price tendencies in the Forex, stock, commodity, and cryptocurrency markets, as well as the development of trading strategies and individual risk management systems. He also analyzes nonstandard investing markets and studies trading psychology.
Dr. BJ Johnson is a PhD in English Language and an editor with over 15 years of experience. He earned his degree in English Language in the U.S and the UK. In 2020, Dr. Johnson joined the Traders Union team. Since then, he has created over 100 exclusive articles and edited over 300 articles of other authors.
The topics he covers include trading signals, cryptocurrencies, Forex brokers, stock brokers, expert advisors, binary options. He has also worked on the ratings of brokers and many other materials.
Dr. BJ Johnson’s motto: It always seems impossible until it’s done. You can do it.
Mirjan Hipolito is a journalist and news editor at Traders Union. She is an expert crypto writer with five years of experience in the financial markets. Her specialties are daily market news, price predictions, and Initial Coin Offerings (ICO). Mirjan is a cryptocurrency and stock trader. This deep understanding of the finance sector allows her to create informative and engaging content that helps readers easily navigate the complexities of the crypto world.