Welcome Everyone, 

Forex Robots: How to maximize their performance

This week I am going to stick with the topic of forex robots but will shift gears a bit.  I want to give you some more pointers to help you have a greater chance at success using forex robots.

Sucess Tip #1:  Don't try and second guess the system.   Many times I have seen traders purchase a robot so that they don't have to do all the hard work and technical analysis and…  What do they do?  They sit watching the robot every single minute and the second it makes a trade they start trying to out smart the robot.  In other words they will try to over ride the robots rules and start prematurely exiting trades.  As a result they end up taking way smaller profits then the robot would have.  If you are guilty of this, let me ask you this…

If you can't trust a robot, Why did you buy a robot in the first place?  Traders often buy robots because they feel they can't trust themselves due to emotional issues or problems with trade execution.  When you find a robot you really like and are happy with its past performance then you need to stand aside and let it do its thing.

Sucess Tip #2:  Don't try indescriminantly use the system.   Another thing I see traders do is to use the forex robot exactly as reccommended by the system creator and then the minute they have a few losses…  They decide to sit it out for a few trades and wait and see what happens.  Well guess what happens next?  The next few trades turn out to be winners and they would have made back much or all their previous losses.  Now they have confidence again and jump back in and gues what happens now?  The next trade was a loser!  Now the trader is totally confused and dejected and not feeling good about themselves or the system.

The bottom-line to success in trading lies in the mathematical probabilites.  In other words, if a system has a 65% win rate with a profit of $150 on every winning trade and  a $100 loss on every losing trade then this is what give you a mathematical edge..  The minute you start trying to second guess or out-smart the robot, then you screw up the mathematical edge.

This applies to any market and both discretionary and mechanical  systems.

Sucess Tip #3:  Don't trade "Black Box systems if…   For you newer traders, the term "Black Box" refers to a forex robot in which the actual indicators and technical analaysis details are not revealed to the user.   For some traders, they need to know every little detail about a robot before they can use it.  If that sounds like you, then you will never be comfortable using a Black Box system regardless of how good it performs.  For me personally, even though I have been trading for 18 years, I don't really care how a system makes the trades as long as it consistantly works and doesn't have any big drawdowns.  I've long ago removed my nasty and unprofitable habit of "paralysis analysis".

I am going to keep this installment of Forex Robots short this week, but keep your eyes open for more information in upcoming forex blog posts.

Have a very profitable week!

Jeff Wilde

 http://www.askjeffwilde.com/97/how-to-use-the-forex-market-forecast-service/

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