Two Sides To Every Robot
When first introduced to binary options robots I was at once intrigued and repelled. The idea of using an automated system to provide analysis, generate signals and help newbies get on their feet is one that I really like. The idea of letting someone else, be it a robot or a person, trade for me is something entirely different. You might say I have a love/hate relationship with them. On the one hand are useful tools that can easily be incorporated into a trading lifestyle and on the other are tools used by the shadiest scammers on the internet. Before we move on I want to make one thing clear. I am in favor of trading tools, I am 100% opposed to having automated trading software make trades in my account.
What Is A Binary Options Robot
These are not machines that sit in front of your computer and make trades. What they are is a classification of software that perform an automated task. This task can be as simple as tracking the market and printing an arrow on your screen when it’s a time to buy or sell or as complex as linking to your trading account and executing the trades for you. In between are a wide variety of services and businesses aimed at one of two things; helping you learn to trade or helping themselves to your money.
Robots are not a bad thing, there are good robots and bad robots all over popular culture. You have the friendly and ever helpful C3P0, you have the always oppressive Terminator. The same is true with binary options software; some are good and some are bad. When you boil it down what you are left with is a computerized trading strategy based on a set criteria. When the market, price action and indicators come into alignment it generates a signal, just like you would do manually if you were using the same strategy.
In today’s world you will most likely run across a robot in the form of a signal service provider or auto-trader. The SSP will use the robot, based on a proprietary strategy or analysis, to produce signals that are then passed on to you. The auto-trader does the same thing and takes the extra step of placing a trade for you.
The thing about these services, and in particular auto-trading services, is that without a human element the signals are worth next to nothing. Every strategy will produce a false signals and bad signals no matter how good it is, or how good the trader using it is. Strategies are only the framework for our trading. They provide a stating off point from which we can begin to trade with confidence. Strategies should produce more wins that losses but it takes experience and a knowledge of the markets to weed enough of the bad signals out to become truly profitable. An automated trading robot does not have what it takes to do that, any and all signals produced will cause a trade in your account.
- Experienced traders can have their trading strategies coded into an Electronic Adviser. EA’s are programs that generate signals based on set trading rules. They are what binary options robots are made of.
How To Use Binary Options Signals And Robots
Binary options robots can be used as part of your education, if you use the right ones. I suggest finding one that you can download to your own computer that is based on standard indicators and that you do not have to auto-trade. The key here is to use the robot as part of your learning, let it become the framework on which you build your trading system. You can follow along with the bot and watch it as it gives signals. You can use rules based on the standard use of the indicator the bot is based on and take only the appropriate signals as they appear. While you are doing this you should also apply money management to your trading. Using a set, small, percentage of your account for each trade is only the first step in the process but helps turn the robot framework into a more fully fleshed trading system suitable for social trading.
Robots; The Good, The Bad and Ugly
There is no right or wrong answer when talking about binary options robots. There are most definitely evil robots, indifferent robots, scam robots and good robots it all just comes down to which one you pick. Any robot that takes over your computer, or places trades in your account is something to be vary wary of. If you don’t know who wrote it, what it does or have control over how it trades you are more likely to have your account automatically emptied, not doubled. Robots that you can use as a tool, ones that operate with transparency and help traders learn to use strategy are much different. It’s like on Star Wars, would you rather be helped by R2-D2 or that crazy four arm bastard, General Grievous?