What to Look for in a Forex Signal Provider – Once you’ve made the decision to use forex signals you still need to select the appropriate forex signal provider. There are dozens of popular forex signal providers and hundreds (if not thousands) of smaller ones. Choosing a reliable forex signal provider requires the weighing of a significant number of factors, some of which may require thorough research. Luckily once you’ve found your provider the bulk of the work will be done for you; from there you can simply sit back, relax, and complete your trades.
The Types of Forex Signal Provider
The first thing you’ll need to do is narrow down the type of forex signal provider that you’re interested in. Forex signal providers come in numerous categories. Some offer small amounts of tips that daily or even weekly intervals — others will offer a cascade of signals throughout the day. Some of them are generated automatically via an algorithm, others are carefully considered by professional, expert analysts. And some forex signal providers are entirely free, while others may be extremely expensive. The type of forex signal provider that you’re looking for should fit into the type of trader that you want to be.
If you’re looking to get into trading and test out the waters, a lower volume, affordable forex signal provider may be best for you. If you’re looking to get started right away and dive into the deep end, you may need a forex signal provider that will be more active. And either way, you need to find a provider that supports the currency pairs that you’re interested in trading. You may even be able to find a forex signal provider that can automate your trading for you — though this is usually an advanced technique that should be done with some caution.
The Benefits of Using a Forex Signal Provider
There are many benefits to using a forex signal provider rather than trying to initiate trades on your own. A forex signal provider offers the benefits of years of experience and knowledge — something that it could take a serious amount of time for you to develop. In forex trading, the faster you start the more money you make, as your earnings compound within your account. Some people simply don’t have the time to delve into the theory and techniques behind trading, or may not want to have to spend all of their time tracking news data and global economic forecasts. Yet trading blind is a perfect way to empty out an account; if you don’t understand the intricacies of your trading, it’s more like gambling.
Forex signal providers also keep you consistent. An emotional trader is not a profitable one. Those who initiate their own trades may be tempted to modify these trades based on their performance rather than sticking to a strategy. In trading, sometimes it isn’t about the specific technique or analysis; it’s about consistency. Trading is about statistics — you’ll always have some losses, but the goal is to find a system that has more wins than losses. If you don’t stick to the system, you won’t be able to identify areas of improvement and your results will be unpredictable.
The Features To Look For In a Forex Signal Provider
Now that you understand the basic types of forex signal provider and why you would use one, here are the major features that you should look for. Note that all forex signal providers have different advantages and disadvantages; there is no “best” forex signal provider, just the one that works best for you.
- Cost. Some forex signal providers are entirely free, but that may not necessarily be a good thing. Free forex signal providers cannot invest their money into developing new analysis patterns or algorithms; instead they usually make their money based on selling information or tutorials. Paid forex signal providers tend to be far more reliable because they are able to invest money into growing their strategies.
- Past performance. Any reputable forex signal provider should be able to show the profit that their strategies have made over the past month, quarter, and year. If your forex signal provider doesn’t have substantial history, they may be new. Anyone can be profitable for a few months. A forex signal provider should have substantial past performance to show how effective they are.
- Technical analysis. Your forex signal provider should be able to tell you exactly what analysis is going into their trades and be able to support their analysis. They may not support all their trades — they may not have time — but they should have some explanatory documentation.
- Volume. The more trades that are initiated, the more opportunities you have for profit. It’s a good idea to go with a forex signal provider that offers at least a few trades a day — though don’t be worried about lulls. There are times in the market when it isn’t a good idea to trade, and a solid forex signal provider will know that.
- Platform support. You’ll need to be able to receive your trades quickly. Ideally, your forex signal provider should support multiple methods of contact — email, text messaging, and apps, just to name a few. The more ways that your forex signal provider has of contacting you, the better.
- Automation. Some traders want this, others don’t, but having automation services available is always a good idea. Sophisticated providers of forex signals will be able to automate accounts so that trades are initiated without requiring you to do anything at all.
- Community. Having a big community is a great thing for those who are just beginning to learn forex. Many forex signal providers maintain a community of individuals who can discuss new trading strategies and the current market.
- Expertise. Who is running the forex signal provider? Anyone can start a forex signal service, so you need to make sure that you’re dealing with professionals.
- Support. 24/7 support is absolutely essential for a forex signal provider. What happens if the service goes down? It’s important that you have a point of contact when it is your livelihood that you are dealing with.
Finding a forex signal provider does require an upfront investment of time — but, as noted, it is an investment in time that only has to occur once. Once you’ve found the right provider for you, you’ll be sent the trades that you need to profit. You can then focus on what’s most important: managing your account and enjoying the fruits of your labor.