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Currency Trading Systems

About speed of execution

Forex is highly volatile and serves huge volumes. Capitalization levels are very high and any economic release or demand/supply imbalance can cause a pair to go for a stop. In all cases, you will need to be quick. You cannot make the most of a market movement after it has lost momentum. Many news or other factors that cause volatility do not remain for long and this is why they cause short-burst changes in the market. The idea is to use the change before you are stopped out or the news loses energy. For this, speed of execution is very important.

Let’s see what a lack of speedy execution can do. Suppose you place a particular stop profit with a broker and the broker fails to put it quickly and the stock moves beyond the point and reverses to its original value. In the given case you stand to lose out on a lot of money. Similarly if they put a stop loss late and the price of stock reaches beyond the value, you will have to bear a greater loss than what you may have desired. This is where a speedy execution might have helped you. Also the dealer on his own let a trader trade for higher prices than the stop if he sees great volumes coming the stock’s way. This has to be done speedily again or the volumes may be lost.

While news trading, speed again begins to matter a lot. Though it is not possible for any broker to place orders very quickly as the market is full of orders at the time of release of news, those who offer one click solution can be handy in letting you bag at least some order.

All this becomes even more important for the short frame players who want to put the pips and generate profit in the 20 minute cycle. This means that they can look to trade Nikkei and Dow Jones within an hour and look for different currency pairs each half an hour. You can yourself imagine how much speed of execution might matter to them. A single button for open/close can be a great help.

This has brought the need for automated programs or forex robots. Of course, they help with many other factors too. The robots use intense mathematical algorithm to track the market. They use many charting software and technical analysis tools but at the end they come with all kinds of figures and estimates very quickly. They analyze when a stock might reverse. They find out the buy/sell options. They find out historical data for future predictions and place pips with high speed. Today, it has become possible to use these robots and trade without sitting at the desk at all. Their speed is proved by the success that they have for short frames.

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