Forex Expert Advisor EA
To automate trading, most of the traders are making use of an Expert Advisor (EA) . This is a piece of software written specifically for the platform MetaTrader (MT) in their own proprietary programming language called MetaQuotes Language Version 4.
The MetaTrader4 trading terminal has several built-in expert advisors. They have the function of an independent trading system and dub the trading signals. They are very popular among beginners and were created specifically to demonstrate the abilities of programming the MetaTrader 4 Client Terminal.
You can create your own technical indicators for more effective work by the advisors – you can set various orders by price and time, automatically open the counter orders, etc. These programs are able to replace the trader at their workplace.
How do EA work?
An Expert Advisor can just advise traders which trades to make by displaying ‘buy’ & ‘sell’ signals on the screen, audio or even sending an email.
Expert Advisor may also be programmed to automatically execute the trades on a live account so therefore the trader does not have any direct involvement. All tasks are performed automatically or mechanically, which is why the advisors are called experts or mechanical trading systems (MTS). In other words the EA is a program sending ‘buy’ or ‘sell’ orders to a broker without any intervention on the part of the trader.
The EA must be installed to the existing forex online trading platform, which is connected to the server broker, and after adjusting all the settings, the advisor will begin trading according to a preset strategy.
Benefits of Forex Expert Advisors
From a psychological point of view, using forex expert advisor sounds very attractive, in particular for the beginners. A trader decreases the responsibility for decision-making, and the trades become less stressful. The trader does not need to have an in-depth knowledge of technical and fundamental analysis, since all the calculations are already included in the program. Besides, the advisor is able to handle the trading signals even when the trader is absent from the computer.
Limitations of Forex Expert Advisors
There are lots of advisors on the Internet, but getting a profitable one is very difficult, and using every single one is exhausting and may result in depleting your deposit. That is why you are advised against buying the first advisor you come across. Many advisors demonstrate excellent results when tested on one currency pair, but perform poorly on others. It is better to use the advisor for those instruments that you have tested on.
Our Best Forex Software page provides you a list of popular software available on the market right now.
The broker used is very important as some EAs that are using scalping strategies necessitate very tight spreads or pure ECN/STP brokers in order to be profitable.