Your Forex trading software should be able to provide what is called ‘trading signals.’ These trading signals are basically indications provided to you by a third party that recommends whether you should buy or sell. Therefore, the best Forex trading software will have this particular function built into it as part of the service.
The second thing your Forex trading software should be able to do is to allow you to put the so-called command ‘stop-loss’. This automated currency order in which you will be sold if it falls below a certain value that you specify. This is important because it keeps you from ‘losing your shirt’ on trades that lost money.
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By defining your stop loss at a certain value, you accomplish two things. First, do make sure that you do not have to be there to have a stop-loss order executed. You just place and implemented at the right time, automatically, unless you cancel. This helps keep you from experiencing additional losses.
The second thing to place a stop-loss order is that it negates the psychological factors that may actually help the cause extreme losses. Let’s say you lose on a trade and you place your stop-loss orders so that the currency is sold after the dollar fell to two.
By doing this, you prevent yourself from the risk of further losses by saying, ‘Well, maybe this currency will gain value again, so I’m going to stay in the trade and see what happens.’ As a result, you are giving yourself an automatic “out” and take yourself out of the process once the losses have occurred.
Remember that even the best Forex trading software can not do everything. Forex trading software is meant to be a tool to help streamline the process of Forex trading for you so automated to some extent. However, you still need to have a good solid knowledge of the Forex system and how it works in order to use your Forex trading software effectively.