You might have heard the buzz surrounding forex signal services in recent years. This is a result of artificial intelligence and other cutting-edge technologies getting more and more advanced. As such, there is a technical arms race between forex signal providers at present, with each system looking to yield the most effective results for those involved in the online trading space.
With that being said, the team at Learn 2 Trade – a UK-based education and forex signal provider, explains that traders need to take a step back and understand exactly what a signal service strives to achieve.
After all, traders should never place an order solely on the back of a forex signal. On the contrary, they should spend the required time assessing the signal through independent research, before acting on the suggestion through the predefined entry and exit trigger points.
Learn 2 Trade explains how this should be achieved.
What Does a Learn 2 Trade Signal Look Like?
First and foremost, traders need to have a firm grasp of what a forex trading signal actually looks like. Most importantly, they need to understand what the signal is trying to tell us. Once this has been ascertained, traders will have the required tools to act on the signal.
Learn 2 Trade explains that a forex signal alert should consist of a number key metrics that [A] allows the trader to place an order with the required entry and exit points and [B] allows the trader to perform their own due diligence on the trading suggestion.
As such, this is what a Learn 2 Trade forex signal alert will look like once it is distributed to subscribers in the form of an email notification and/or RSS feed.
- Pair: AUD/JPY
- Technicals: The Relative Strength Index (RSI) is at 79 on AUD/JPY. Momentum is strongly in favour of buyers.
- Order: Buy order
- Entry: 71.04
- Stop-Loss: 70.22
- Take-Profit: 72.88
As you can see from the above, a Learn 2 Trade signal provides a range of information. Not only does this include the specific entry and exit points, but it also explains what the algorithm has identified. In this example, it is that the RSI on AUD/JPY is at 79, meaning that trading momentum is favouring the bulls. As such, the forex signal suggests placing a buy order at 71.04.
Assessing the Forex Signal
Once the trader has received and understood the forex signal in question, they are then advised to perform some independent research. This is for a number of reasons. For example, it allows traders to cross-reference the signal against their own research.
It also allows the trader to assess whether or not the suggestions mirror their own trading strategy. For example, while the RSI can be a highly effective technical indicator to use when trading forex online, not all traders utilize it.
Moreover, the Learn 2 Trade signal allows traders to then take the identified indicator to the next level. For example, the trader might then manually look at other key technical indicators on AUD/JPY – such as the MACD or moving averages.
Once they do, they will then have a much better idea of whether or not the forex signal should be acted upon. If it is, the trader can then make some considerations regarding the suggested entry and exit points.
Assessing the Entry and Exit Points
AI Trading Bots such as those utilized by Learn 2 Trade will yield suggested entry and exit points. These are based on historical charting patterns, as well as the current price of the currency pair in question. With that being said, your risk levels might be slightly lower (or higher) than the Learn 2 Trade stop-loss order warrants.
For example, let’s say that the stop-loss order will result in a maximum loss of 1%. However, you might have a strict code of practice that does not allow single trades to yield a loss of more than 0.5%. As such, you might decide to alter the exit point. A further alteration that you might decide to implement is that of the take-profit price.
For example, if the Learn 2 Trade algorithm suggests a take-profit price that amounts to gains of 1%, this might be slightly lower (or higher) than your own projections. As such, you might decide to increase the take-profit percentage to 1.5%. Either way, the key point here is that you have heaps of flexibility when it comes to acting on a Learn 2 Trade forex signal alert.
The Bottom Line
As effective as forex signal services are, they should be viewed as a precursor to your online trading endeavours. By this, we mean that once a forex signal is received, you should then make some considerations on the information that has been provided. This should include entry and exit prices, as well as the underlying reason why the signal was sent.
If you are interested in finding out more about the Learn 2 Trade forex signal service, the platform offers a competitive subscription of $25 per month. Those that wish to extend their membership can reduce the price to $55 and $85 for 3 and 6 months, respectively. Crucially, all plans come with a money-back guarantee.