Forex robots provide an exciting way of earning profits in the online Forex market. Without forex robots, we could still be hooked to the traditional methods of trading. For a long time, profiting from currency trading required that you undertake thorough technical analysis, always follow the news, carry out extensive fundamental analysis, and hook yourself to a computer screen watching price charts.
Most traders understand that this is very strenuous and could lead to burnout, which could magnify losses instead of profits. With this realization, automatic trading technologies have surfaced to make trading easier, lower risks, and increase the chances of getting more profits.
So, What is a Forex Robot?
A forex robot also called an Expert Advisor (EA), is a piece of software with inbuilt programmed rules that automatically make trade entry and exit decisions on MetaTrader 4 platform for Forex trading.
Here are some functions Expert Advisors can do.
- Initiating trades
- Managing opened positions
- Exiting trades
- Generating signals for the trader
- Copying trades to other trading platforms
- Trading automatically round-the-clock
In manual trading, a trader normally establishes the trading rules and then follow those rules every time she or he wants to enter or exit a position.
As such, a manual trader has to glue himself or herself in front of a computer screen and wait for the appropriate time when the criteria for making a decision fits with his or her rules—something which is tiring and complicated.
With robot trading, the trading rules or strategies have been ingrained in a computer program, and your trade decisions will be made automatically without your intervention.
Here are some benefits of using automated trading systems.
- Ability to trade non-stop
With a trading robot, you can trade profitably 24 hours a day and increase your profits. After you’ve coded your strategies on a robot, it will perform the buy and sell actions while you spend your time on the beach.
- Removes emotions from trading
One of the main reasons why traders fail is emotional trading. However, a forex robot lowers or eliminates emotions from the trading equation and give you a reliable way of earning money.
A robot cannot fear to make a trade neither can it start making greed-driven decisions.
- Reduces trading errors
Automated trading systems can perform complicated calculations without making errors.
Since humans can be at fault, traders normally find themselves making silly mistakes, which could have been avoided. Since robots make decisions based on preset rules, they greatly minimize trading errors.
Forex Trading With Robots
Forex trading with robots is growing in popularity around the world, mainly because of its benefits over manual trading.
Most traders have resorted to automatic trading as a way of allowing them to use multiple strategies to enter and exit trades.
Regardless of the number of strategies you have, you can program them into a robot, and your trades will be automatically handled for you—without the fear of losing any opportunity.
On the other hand, with manual trading, you are forced to use a single strategy each time you want to enter the market.
If you try using multiple strategies at the same time, it’s highly likely that you can lose concentration and make costly mistakes.
Furthermore, unlike manual trading, robot trading is not influenced by emotions and is independent of traders’ psychology.
An expert advisor will follow your predefined trading rules, regardless of the prevailing market condition.
It will not enter into a panic mood whenever a trade goes the wrong way or make ill-timed revenge trades after a big loss. It will not suddenly feel ‘lucky’ and take another trade after a huge win.
Instead of getting emotional when something bad happens, a robot will follow your strategies to the latter while consistently providing you with a way of making good returns from your investment.
How Does a Forex Robot Works?
Basically, an expert advisor for MetaTrader 4 works by utilizing predetermined strategies or rules for making trade decisions.
The rules are programmed on a robot, which it uses to automatically enter and exit trades.
With implanted strategies, robots are capable of making trade decisions in a way that humans cannot.
Some robots can thoroughly and effectively scan the market looking for opportunities with high levels of accuracy than humans.
For example, if you have a successful trading strategy that relies on indicators, candlestick patterns, support and resistance levels, or other stuff, you can implant it on a robot, and just sit back and allow the computer program to do the hard work for you.
Furthermore, if a robot is programmed to make a sell order whenever a currency pair reaches a resistance level, it will obey those instructions always.
And, if you need to make an adjustment, you can just open your code and include the parameters you desire.
The trade targets are also coded on a robot. Most automated trading strategies include a take profit and a stop loss level to safeguard profits and prevent extensive losses, respectively.
Without such precautions, a robot can trade endlessly and cause more harm than good.
Therefore, even if robots lack the intuition that human traders have, they are a good way to automate systematic trading strategies and siphon massive profits from the market.
How to Use a Forex Robot
To start using a trading robot, you can purchase one from a reliable vendor or build one yourself. When buying an EA, ensure you go for the one with the high reputation and verifiable results.
In addition, you should ask your broker if the robot is compatible with their trading platform. Since the expert advisor will communicate directly with the broker’s server, purchasing an incompatible software could make more holes to your pocket.
After you’ve bought the software, follow the steps stipulated in the manual to install it on your MetaTrader (MT4) platform. Ensure that you strictly follow the setup instructions.
If you experience any difficulty, contact the vendor immediately.
Failing to go through a thorough installation process could cause problems to your software, and lead to its poor performance.
It’s important to note that you can install multiple robots on your MT4 terminal. With several expert advisors installed on your MT4, you achieve different trading objectives and escalate your profits.
Remember not to cloud your platform with a bunch of robots that cannot add value to your trading.
Once you’ve installed the robot, you’ll need to attach it to the chart of your preferred instrument and timeframe. This way, the robot can aptly utilize your preset trading strategies.
Furthermore, robots usually have various settings, which you can use to get the best combination for maximized returns.
You can also try the settings on a demo account under simulated forex trading conditions and move them to a live account once you’re confident enough.
How to Install Forex Robot on MT4
Installing a forex EA on MT4 is a very simple process. Here is how it can be done.
Step 1: Open the Data Folder
After launching your trading terminal, click on “File” on the top navigation menu. Thereafter, click the “Open Data Folder” on the drop-down menu.
You will then be directed to your MT4’s Data Folder where you can install the expert advisor.
Step 2: Include the EA on the Data Folder
On the opened Data Folder, double click on the “MQL4” folder.
While inside the folder, double click on the “Experts” folder. This is the place where the robots will be included.
Step 3: Paste the EA files on the Experts folder
Then, copy the EA files from their native location and paste them on the opened Experts folder.
In this case, we are using the Bollinger Band EA by Forex Robot Academy.
Thereafter, restart the MT4 terminal or Refresh the Navigator window to ensure the EA is available for use.
To find the EA, navigate to the “Experts Advisors” tab under the “Navigator” box on the left side of your MT4.
If you click on the “Plus” icon, you’ll see the EA already available for use.
Step 4: Adjust MT4 settings
On your MT4 terminal, go to the “Tools” menu and click “Options”.
Then, on the popped-up table, under “Expert Advisors”, ensure the boxes are checked as indicated below.
Alternatively, activate the “Autotrading” button on the top of the platform to ensure MT4 allows automated trading on the account (showing green color).
Step 5: Attach the EA on a chart
Drag and drop your trading robot on your preferred currency pair and timeframe, suitable for the robot (usually outlined in the instructions manual).
Step 6: Adjust EA settings
On the pop-up window giving your EA’s settings, ensure all the parameters meet your requirements before clicking “Ok”.
In the Common tab make sure the “Allow live trading” and “Allow DLL imports” are enabled.
If everything has worked well, you’ll notice a smiling face on the top right-hand section of your trading platform.
Your Forex EA is now successfully installed on the MT4, and you can start smiling all the way to the bank 🙂
How to Build a Forex Robot
An expert advisor for MetaTrader 4 can be built in several ways. Here are some of them.
- Use the inbuilt MetaEditor Wizard
You can create a simple EA using the MQL4 Wizard inbuilt on the MT4 trading platform.
To access the MQL4 Wizard, right-click on “Expert Advisors” and click “Create in MetaEditor”.
Consequently, you’ll be provided with a pop-up window where you can set all the properties to create the EA template. Although, without programming skills, you are likely won’t do much there. The MQL4 Wizard will give you just a temple of the EA to start with and the rest of the code, trading rules, and trade execution functions must be added separately.
- Use an Expert Advisor builder
An EA builder allows you to create a robot without any programming skills. Some of the expert advisor builder tools are online-based while others require installation on a computer.
You can use the tools to create the trading rules and strategies in their visual-mode building environment.
An EA builder tool enables you to select your preferred indicators and easily set other trading parameters.
- Build from scratch
If you know the MQL4 programming language, you can build an EA from scratch.
You can also hire a professional programmer to do the work for you.
- Use the forex EA generator tool
This is one of the best ways of building a profitable forex trading robot.
With the forex EA generator tool, you can confidently create amazing robots and reliably make good profits from forex trading without any programming skills or hiring a programmer.
And, you should go for a tool that has earned the industry’s trust and is capable of generating authentic money-making EAs.
One such good software is the Expert Advisor Factory from Forex Robot Academy.
Expert Advisor Factory not only can create hundreds of Forex Robots but also optimize their settings for best performance and instantly test them on a historical price data. This way you find only robots that actually have proven trading rules incorporated. No more dealing with trading robots that show no success.
How to Backtest Expert Advisor
Backtesting an expert advisor for MetaTrader 4 will assist you to gauge whether it generates accurate trading signals or not.
If you created a robot using the above-mentioned Forex Expert Advisor Generator, the tool allows you to easily carry out backtests against real historical data and also under simulated forex trading conditions.
Also, if you have an expert advisor already installed on your MT4, you can use the Strategy Tester for backtesting its success.
To start using the expert advisor tester feature, click on “View” and select “Strategy Tester”.
A panel will pop-up on the lower section of your trading terminal from where you can select the EA you installed. This is the “Strategy Tester”.
Consequently, set your preferred parameters—such as currency pair, timeframe, spread, and backtesting period.
It’s important to note that the MT4 Strategy Tester only use fixed spreads, which may not be very accurate.
So, if you want to carry out more advanced backtesting using a variable spread that occurred in the past, you can follow this free guide: The Ultimate Guide to MT4 Backtesting
After you’ve set the parameters to your satisfaction, click the “Start” button on the right-hand side of the Strategy Tester panel and allow your test to run.
After a short time, the results will be displayed on the Graph or Results tab found on the lower section of the panel.
Free Forex Robot for MT4
If you want a free robot to test the world of automated trading, you can find one in the MQL4 Market. The site has a vast database of free and paid Forex robots you can choose to automate your forex trading.
You can get simple automated systems or complicated robots that can efficiently make trade entry and exit decisions on your behalf.
Importantly, before downloading any robot, do sufficient background research and backtest it using an expert advisor tester.
Furthermore, the MQL4 market has other tools that can assist in automating tasks and boosting your trading experience.
Examples include trailing stop tools, break even tools, and customized indicators.
Using Forex robots is the only way to trade multiple instruments at the same time.
In manual trading, a trader has to glue himself or herself in front of a computer screen and wait for the appropriate time when the criteria for making a decision fits with his or her rules—something which is unprofessional, tiring, and complicated.
With a Forex EA, you can effortlessly trade non-stop, eliminate emotion-based trading decisions, and reduce trading errors—somethings difficult to achieve when manual trading. MT4 Expert Advisors never sleep and can look for trades all day long 24 hours a day and 5 days a week.
Start robot trading today!