EA (Expert Advisor) or forex robot is a program that runs on MetaQuote's trading platforms (MT4 and MT5), used to search for signals, monitor or automatically execute trades using algorithms. The math is pre-programmed by the trader.
The EA will search for trading opportunities according to the preset trader parameters, then notify the trader to make a decision whether to trade or not or the EA will execute the trade on its own without notice, depending on Depends on each person's trading strategy.
If in the past, traders would have to sit in front of a computer for hours and hours to analyze and discover trading signals, and then start to enter orders, take profits, stop losses or close orders, today thanks to the development of With the development of technology, EA was able to automate all of the above tasks, optimize transactions, in order to achieve the highest efficiency for investors.
EA is used not only with currency pairs but with all products offered by the forex broker you trade such as gold, indices, stocks, crude oil or cryptocurrencies...
How does Forex Robot or EA work?
The EA is written in a proprietary programming language called MetaQuotes Language, version 4 or 5 (MQL4, MQL5), which traders use to create algorithms according to their trading strategies.
The algorithm here is the statement that shows the trading conditions, the rules to trigger the trading decision of the strategy, if the trading conditions and rules are satisfied, the EA will report to trader or it will automatically execute the trade without any intervention.
The strategies established on the EA can be the ones that the trader has successfully traded based on technical indicators, candlestick patterns, trading support tools such as trendline, support/resistance. , Fibonacci… or any other trading tool or means. Traders only need to set up the EA through the algorithm, the rest, the identification, analysis and even automatic trading will be done by this robot.
When starting to activate the EA, the Forex Robot will scan and analyze the market on the price chart to identify buying or selling opportunities based on previously programmed strategies. Once a trade is opened, other orders such as stop loss, take profit will also be activated. If you want to adjust the parameters, you just need to change the settings.
The most popular types of Forex EAs or Robots used today
EAs can be divided into 2 main types: automatic EA and semi-automatic EA.
The automatic EA will execute the order as soon as the trading conditions and rules are satisfied without having to notify the trader.
The semi-automatic EA will only detect signals and calculate parameters (entry point, stop loss, take profit ...) for the transaction, based on the installed strategy and then report to the trader, and the rest Whether to follow or not is the trader's decision.
Example of EA . trading order execution
Example1: A trader sets up an EA with the following condition: enter a Buy order with a volume of 0.5 lots as soon as the 20 MA crosses the 50 MA 50 from the bottom of the EUR/USD pair, on the H1 timeframe. Take profit and stop loss at positions 1000 pips and 250 pips away, respectively.
When activated, the EA will automatically be added to the price chart of EUR/USD on the H1 frame, at any time when the MA20 crosses the MA50 from the bottom, a Buy 0.5 lots order will be opened immediately. immediately, accompanied by stop-loss and take-profit orders with corresponding conditions that have been installed. Assuming entry point is 1.12500, stop loss is 1.10000 and take profit is 1.22500.
Example2: Suppose another trader sets up an EA based on a candlestick pattern trading strategy with the following conditions: when seeing the Bearish Engulfing reversal candlestick pattern appear on the H1 frame of the USD/JPY pair, immediately calculate calculate the parameters including entry point (close price of bearish candle in Bearish Engulfing pattern), stop loss, take profit and then notify the trader.
Similarly, when activated, the EA will immediately appear on the H1 price chart of USD/JPY. The EA will scan this price chart until the EA detects the Bearish Engulfing pattern, will calculate the required parameters and notify the trader. Of course, the calculation of the EA must happen very quickly, so that when seeing the analysis results, the trader will decide to execute the order or not.
The examples above are just very simple trading strategies, in fact the EA is programmed to follow much more complex trading conditions, and sometimes the EA also makes quick and accurate decisions. more accurate than traders, when it comes to those situations. Or even if a trader can completely analyze and make a judgment, it will take a lot of time and effort.
Should I use EAs?
To discuss whether to use EA robot for forex trading, first, we need to consider the effectiveness (advantage) and limitations (disadvantage) of the EA.
Effectiveness of EA
The first and impossible advantage
The EA will search for trading opportunities according to the preset trader parameters, then notify the trader to make a decision whether to trade or not or the EA will execute the trade on its own without notice, depending on Depends on each person's trading strategy.
If in the past, traders would have to sit in front of a computer for hours and hours to analyze and discover trading signals, and then start to enter orders, take profits, stop losses or close orders, today thanks to the development of With the development of technology, EA was able to automate all of the above tasks, optimize transactions, in order to achieve the highest efficiency for investors.
EA is used not only with currency pairs but with all products offered by the forex broker you trade such as gold, indices, stocks, crude oil or cryptocurrencies...
How does Forex Robot or EA work?
The EA is written in a proprietary programming language called MetaQuotes Language, version 4 or 5 (MQL4, MQL5), which traders use to create algorithms according to their trading strategies.
The algorithm here is the statement that shows the trading conditions, the rules to trigger the trading decision of the strategy, if the trading conditions and rules are satisfied, the EA will report to trader or it will automatically execute the trade without any intervention.
The strategies established on the EA can be the ones that the trader has successfully traded based on technical indicators, candlestick patterns, trading support tools such as trendline, support/resistance. , Fibonacci… or any other trading tool or means. Traders only need to set up the EA through the algorithm, the rest, the identification, analysis and even automatic trading will be done by this robot.
When starting to activate the EA, the Forex Robot will scan and analyze the market on the price chart to identify buying or selling opportunities based on previously programmed strategies. Once a trade is opened, other orders such as stop loss, take profit will also be activated. If you want to adjust the parameters, you just need to change the settings.
The most popular types of Forex EAs or Robots used today
EAs can be divided into 2 main types: automatic EA and semi-automatic EA.
The automatic EA will execute the order as soon as the trading conditions and rules are satisfied without having to notify the trader.
The semi-automatic EA will only detect signals and calculate parameters (entry point, stop loss, take profit ...) for the transaction, based on the installed strategy and then report to the trader, and the rest Whether to follow or not is the trader's decision.
Example of EA . trading order execution
Example1: A trader sets up an EA with the following condition: enter a Buy order with a volume of 0.5 lots as soon as the 20 MA crosses the 50 MA 50 from the bottom of the EUR/USD pair, on the H1 timeframe. Take profit and stop loss at positions 1000 pips and 250 pips away, respectively.
When activated, the EA will automatically be added to the price chart of EUR/USD on the H1 frame, at any time when the MA20 crosses the MA50 from the bottom, a Buy 0.5 lots order will be opened immediately. immediately, accompanied by stop-loss and take-profit orders with corresponding conditions that have been installed. Assuming entry point is 1.12500, stop loss is 1.10000 and take profit is 1.22500.
Example2: Suppose another trader sets up an EA based on a candlestick pattern trading strategy with the following conditions: when seeing the Bearish Engulfing reversal candlestick pattern appear on the H1 frame of the USD/JPY pair, immediately calculate calculate the parameters including entry point (close price of bearish candle in Bearish Engulfing pattern), stop loss, take profit and then notify the trader.
Similarly, when activated, the EA will immediately appear on the H1 price chart of USD/JPY. The EA will scan this price chart until the EA detects the Bearish Engulfing pattern, will calculate the required parameters and notify the trader. Of course, the calculation of the EA must happen very quickly, so that when seeing the analysis results, the trader will decide to execute the order or not.
The examples above are just very simple trading strategies, in fact the EA is programmed to follow much more complex trading conditions, and sometimes the EA also makes quick and accurate decisions. more accurate than traders, when it comes to those situations. Or even if a trader can completely analyze and make a judgment, it will take a lot of time and effort.
Should I use EAs?
To discuss whether to use EA robot for forex trading, first, we need to consider the effectiveness (advantage) and limitations (disadvantage) of the EA.
Effectiveness of EA
The first and impossible advantage
