About Auto Trading
AUTO trading is a technique of applying a software program to a specific instruction for trading. Manual trading is always a headache for traders, as trading successively loses panic to traders, and slowly it can be a cause of loss of patience.
Most traders are now shifting from manual trading to AUTO trading to increase the rate of profit. It is easy to achieve as the frequency increases. In both the Indian and foreign exchange markets, AUTO trading or auto robot trading is possible.
Most of the traders now use AUTO trading in their trading pattern using FOREX trading. Most of the trading platform is currently creating a built-in auto trading feature that makes trading easy, profitable, and emotion-free.
What is an EA?
Expert Advisor (EA) is a piece of software that informs you when to do business or even automatically initiates and executes business following pre-programmed instructions. The implementation of expert consultants is frequent on the MetaTrader 4 or 5 Forex trading platforms.
These EAs are present in the programming language also known as MetaQuotes Language, in the short form “MQL.” Both MetaTrader and MQL are developed by MetaQuotes Software Corp.
The advantages of the EA Forex markets are available around the globe 24 hours a day and seven days a week. You can also use it as an expert consultant or a comparable trading instrument like a Forex robot to do business in your absence. It also allows you to take advantage of trading possibilities while you’re working, sleeping, or busy.
What are the benefits EA?
The use of the EA also removes the emotional factor from your trading. Your fear or greed will not play a part in whether or not you choose to react to trading signals; the EA will conduct business based on your orders without considering how to spend profit or whether a loss.s
If Forex trading is your primary revenue generator, using an EA can decrease your stress level and make a possibly emotionally and mentally exhausting and time-consuming business much less so.
On an associated note, an EA or a robot can consider far more variables at the same moment than you might have hoped to wrap your head around. And at the same moment, these variables can be considered for several distinct currency pairs. You can’t, no matter how smart you are.
Disadvantages of EA:
Disadvantages of EA If your EA is unable to react to real-time news, it would disregard significant primary reasons for doing business or not doing business. If you’re at your desk to keep track of the news, you can prevent such trading errors.
And likewise, even though the EA can cope with more factors at once than you can, it can only act on what you’ve programmed to do. You’re not as rigid in your thinking, and you can react to factors that fall outside those restricted parameters. And there may be times when this is essential to prevent a significant trade error or to take advantage of a substantial chance.
How to backtest An EA?
Follow the measures below to get your EA backtest:
- Discover the display tab at the top left corner of your computer. From the drop-down menu, select Strategy Tester.
- At the bottom of the screen will appear the Strategy Tester window. Choose your EA from an Expert Advisor selection.
- To pick the currency pair and timeframe, use the symbol and timeframe parameters.
- Check the usage date box and indicate the period.
- Choose the choice “Every Tick” and “Current” for the most exceptional modeling quality.
- Please click the Start button.
Your outcomes can are present in a log, balance chart, or report. Use the issues, chart, or report tab to select your preferences. Your problems are also visible in a graph, click Open Chart in the Strategy Tester window.
Things to remember during backtesting of EA
Points to consider: First, your cost history information needs to be completed before beginning a backtest. This will prevent incorrect chart mistakes in your trading log, which will result in a modeling performance that is reduced than 90%.
Under the Tools tab, pick the History Center and click the F2 button on your keyboard. A variety of currency pairs will appear, choose the one that you will be testing, and check if your selected time frame is in the database. If you don’t, press Download.
With the ever-growing plethora of EA to choose from, traders can be overwhelmed by selecting the most suitable and ultimately the most profitable.
We know that the past is not always future-reflective, but we also know that patterns are recurrent. Backtests are an easy way to find models that can assist you in highlighting your scheme’s strengths and weaknesses. This article aims to elaborate on how to handle your automatic test using (MT 4)MetaTrader 4.