The FOREX or the foreign exchange trading system is a way for traders to buy and sell or more directly trade on the movement of currencies. The idea is that you have to decide whether a currency pair is going to increase in value for one half of the pair or the other.
This means that if you took a trading pair such as USD and EUR which is the United States dollar and the Euro. You would need to decide whether the value of the USD would rise or fall against the EUR. You then decide how much you would stake against each point or pip and which way the value will go.
With an automated trading system it is the computer program that monitors the falling and rising values and decides on your behalf when is the best time to close out. By watching the rise and fall of the market the program can see when the best time to jump into the market is and when to exit thus maximising your profits.
One of the major benefits of automated forex software is that they can run non stop trading on active markets. You do not have to sit in front of a screen constantly checking stats.
This type of software can be based on algorithms or programmed from the knowledge of experienced traders. This basically means they teach the system the rules that they would use when trading.
Whilst these systems can work well one of there problems is that they are just machines, essentially they do not understand risk, gut feelings or trends. The human brain is amazing at seeing patterns and abstract thought, although the brain cannot do millions of calculations a second it can think outside the box and change its way of looking at thinks. Computer programs can only as a rule follow there programmed instructions.
There are however a new breed of trading systems that can adapt to jumps in the trading market and adapt accordingly. One such system is the automated forex grail by Dr. Johnson. This is a forex robot that can adapt to changing market conditions and change its thinking to provide a more profitable outcome than if it had followed its fixed set of rules.
Whilst no system can be perfect a system that can alter to operate more effectively in a changing market will return higher profits. In forex trading profits are the holy grail of automated forex trading systems.