Signals are very popular today in Forex trading especially among new traders who don’t have their own trading experience and strategy. Thus they prefer to rely on the strategy of other traders hoping that those gurus know what they are doing and will help them make money in Forex trading. First, when using trading signals you need to realize that you trust your money into the hands of someone who you don’t know and cannot evaluate his trading experience.
Second, you have to adjust to the rhythm of someone’s life, and therefore will have to be on the market each time you receive a signal. Sometimes it may happen in the middle of the night or when you are outdoors, etc. Third, if you are trading according to the signals, it does not mean that you will avoid losing. He who gives you the signals can not be wrong. So you have to catch every signal to recoup. What can happen if you do not catch every signal is shown in the example below.
Let’s say, you have got 5 signals a week each one made the following results:
1 2 3 4 5
+20 pips, +50 pips, -110 pips, +35 pips, +80 pips
Let’s say you have applied the first four signals, while the fifth one you have missed due to some reasons. You can take a calculator and calculate your total gain using the first four signals; it comes out with a total – 5 pips. Means that you will be in a loss because of the missing fifth signal, which would help finish the trading week with a total profit of 75 pips.
Fourth, subscribing to the signals and applying them to your Forex trading you lose time that could be spent on acquiring and developing your own trading skills. After all, as many traders say and according to our own trading experience – really useful trading skills come only when you trade according to your own decisions and your real money.
Fifth, you lose money. Let’s say, your signals provider sends you 20 signals a month. The cost of registration is $ 2 per signal. As it was clear from the example above, you don’t wish to miss a signal (because you can get a loss and have a negative result, despite the overall positive statistic of the signals). And here you are paying $40 a month, relying on the fact that your signals provider will not make a mistake in the signals or will not stop to send signals at all.
By the way, think that your signals provider is actually a real person and he is so sure of himself that he takes money to present trading signals to other people. Wouldn’t he make enough money by trading Forex using his signals himself? If it were so, why would he then mess up with the mailing lists? Feel the catch? Apparently, such people lack confidence in their abilities. They are afraid for their deposit, but don’t care for others, so the source of income they choose is you.