Automatic Forex system trading is the practice of recognizing a specific pattern in the fluctuations of price between any given currency pair. This type of pattern recognition can be quite effective for many traders if they maintain disciplined money management principles. Specifically, taking a stop loss and getting out of a trade if the system tells you to.
These two principles, are used by many successful traders, not just trading Forex, but in all markets where short term traders seek to profit from price fluctuations utilizing leverage to make the small fluctuations profitable to trade.
Automatic Forex system trading is just half of the equation, however a very important part of it. A robust system can be as simple as a moving average cross over. A system need not be convoluted and complicated to be successful. One that is right 5 out of 10 times can be a very profitable system if your stop loss is small enough and your wins are big enough.
For example, if it tells you to get out at $100 dollar loss and it is right 50% of the time. This means your wins need to be at least $100 to break even. If your average win is $200 or $300 then you obviously have a profitable system.
Many new traders get bogged down in the search for the perfect system, however, there is no holy grail. A 5 out of 10 system can make you ample money. To be right more than 5 times out of 10, this trader believes is pretty much impossible, however, the good news is, you don’t have to be perfect to make money, but just good enough
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