Trading With Signals

How to pick, how to select, how to use trading signals

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Author: Guy Avtalyon, data analyst

This tutorial, Trading With Signals, will show you all types of trading signals, no matter if they are Forex, market or stocks.

The most important, WYT Finance wants to show you how to pick, how to select, how to use trading signals.

But also how to recognize signal seller scammers and the best signal providers.

What are the benefits of using trading signals

 

The benefits of using them include better trade results in less time.

If you prefer to trade online, they have evolved from advancements in electronic trading. They are derived from standard trading sources or analytical programs using technical indicators.

Using them can help the trader capture more profitable trades to grow his or her account.

They are useful to these traders: the signals are essential indicators to help the trader to monitor the market.

To enable the trader to immediately act on trading signals, the trading platform sends the signals to the trader’s phone, tablet, or computer.

Traders with limited time to perform analysis or new traders can benefit from using forex signals.

What trading signals are

The trading signal is an alert that you receive, letting you know that it is time to long or short a market.

A trading signal isn’t executed automatically.  That means you’re able to take the time to analyze the market yourself. And later, decide whether the risk profile of the particular trade fits into your overall trading strategy.

The fact is, making money is fun and sexy while the process of making it may not be so sexy.

But we took some facts to show you how incredibly sexy trading with signals is.

So, WYT Finance’s primary goal is to show how to use the trading signal for your own benefit.

Trading with signals can give you an advantage.

Trade signals come in a variety of forms, including bull or bear pennants, rectangles, triangles, and wedges, as well as head-and-shoulders chart patterns.

They may also bring attention to abnormal volumes, options activity, and short interest.

There are lots of trade signals, as anyone can make calls, the challenge often is finding one run by an actual trader.

The advantage of a stock trading signal is the fastness of the decision.

Many traders find themselves stuck with analysis and never really know when the best time to actually buy into a stock trade is.

Stock trading signals remove the trader’s emotion and indecisiveness that trading stocks can create for individuals.

Signaling took root in the idea of asymmetric information, which is a deviation from perfect information. Which means, in some economic transactions, inequalities in access to information upset the normal market for the exchange of goods and services.

The market can send out powerful signals.

Forex signal services do everything a robot does except the actual execution of trade entries.

Besides this, you can find, a professional trader to generate trading signals for clients.

They are consolidated information from technical analysis tools, like currency pairs for example. They help a trader make a correct forecast and execute a successful trade at the right time.

Note that trading signals do not guarantee a profit from a trade. But they can substantially increase your chances of a successful trade.

Of course, especially if you combine them with other methods of technical and fundamental analysis.

You may ask if trading signals work. The answer is Yes!

And in this tutorial Trading With signals, our author, Guy Avtalyon will show you how.

In this tutorial, he will give you numerous instructions on how you can use trading signals, who are trading signal providers, how to avoid signal provider scams.

What are the trade signals?

Trade signals are simply when someone is making a trade call, either to buy or sell a security or other asset, generated by analysis.

So if they believe an asset will go higher or lower, they will tell you via some kind of message, email or software. After that, it is up to you to follow or not to follow.

Actually, the trading signal is an alert that is based on technical indicators, that it is a good time to buy or sell a particular security.

Trade signals come in a variety of forms, including bull or bear pennants, rectangles, triangles, and wedges, as well as head-and-shoulders chart patterns.

Trading With Signals

Bull pennants

 

 

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Bear pennants

 

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Rectangle Signal form

 

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Triangles Signal form

 

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Wedges Signal form

 

Trade signals may also bring attention to abnormal volumes, options activity, and short interest.

There are lots of trade signals, as anyone can make calls, the challenge often is finding one run by an actual trader. These type of services exist in the institutional world as well, they just tend to be a little more accurate than ones you find available to retail traders.

Market Signal is an unintentional or passive passage of information or indication between participants of a market.

For example, If a firm issues bonds it indirectly shows that it needs capital and also desires to retain control thus instead of equity capital it prefers loan capital. It is based on the technical indicators and usually is the sign for when to sell or buy a particular product.

It also brings the attention of users to the other options available, abnormal growth and short-term interests.

Using signals in volatile markets can help to point out opportunities to the investors and also will signal them if they disappear.

 

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There are usually two ways to deliver market signal: send news and activity.

The market signal expects to deliver consumer, rivals and outlet member, and the earlier studying of the market signal which is mainly concentrated on the signal’s influence.  

For instance, it is the price signal where costly products make the customer think it is made of high-quality raw material.

That is a kind of advertisement in which the main aim is to make the customer think that a certain enterprise has more advantage.

Every company doesn’t market in a static environment, the competitor and member of the outlet will make prediction and reaction to enterprises, their decisions process is a dynamic market mechanism.

In Forex, trading signal systems are used by traders all over the world to aid them in making critical decisions about their trades.

They are one of the most important tools a trader has an almost all traders choose to use them in one way or another.

There are many types of signals systems.

 

Some are offered for free while others for a fee but take in mind that a trustworthy service should include information about taking profit and stop loss configurations.

 

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A forex signal is a suggestion for entering a trade on a currency pair, usually at a specific price and time.

The signal is generated either by a human analyst or an automated Forex robot supplied to a subscriber of the forex signal service.

Due to the timely nature of signals, they are usually communicated via email, website, SMS, RSS, tweet or other relatively immediate methods.

The majority of signal providers focus on supplying signals based on technical analysis and a minority work on fundamental analysis or price action.

Technical analysis, such as Ichimoku and candlestick charting, show both short and long-term price trends giving the signal provider flexibility in supplying a range of trade options.

Fundamental analysis gives longer-term trade ideas.

Price action gives extremely short-term trade ideas, often more suited to scalping.

The signal in the stock market is developed by George Lane, is an indicator that measures the relationship between an issue’s closing price and its price range over a predetermined period of time.

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George Lane (1921 – 2004)

A short note about George Lane (1921 – 2004).

 

He was a securities trader, author, educator, speaker, and technical analyst. He was part of a group of futures traders in Chicago who developed the stochastic oscillator (also known as “Lane’s stochastics”), which is one of the core indicators used today among technical analysts. A March 2007 article quoted George Lane’s description of his famous indicator: “Stochastics measures the momentum of price’’.

If you visualize a rocket going up in the air – before it can turn down, it must slow down.

Momentum always changes direction before price.

This means as prices move down, the close of the day has a tendency to crowd the lower portion of the daily range.

Just before you get to the absolute price low, the market does not have as much push as it did. The closes no longer crowd the bottom of the daily range.

Therefore, Stochastics turns up at or before the final price low.

Lane was also President of Investment Educators Inc. in Watseka, Illinois, where he taught investors and financial professionals basic and advanced technical analysis methods. He popularized the stochastic oscillator, a momentum indicator that uses support and resistance levels.

The term stochastic refers to the point of a current price in relation to its price range over a period of time.

This method attempts to predict price turning points by comparing the closing price of a security to its price range.

The 5-period stochastic oscillator in a daily timeframe is defined as follows:

 

%K = 100 * (Price – L5) / (H5 – L5)

%D = ((K1 + K2 + K3) / 3)

 

The H5 and L5 are the highest and lowest prices in the last 5 days respectively, while %D is the 3-day moving average of %K (the last 3 values of %K).

Usually, this is a simple moving average, but can be an exponential moving average for a less standardized weighting for more recent values.

There is only one valid signal in working with %D alone — a divergence between %D and the analyzed security.

Stock trading signals are simply the implementation of a trading system or method.

The actual signal is given when a traders system determines all criteria necessary for a new buy signal are met and a new buy order can be placed by the trader.

Stock trading signals are most often associated with technical analysis, which is a study of price action and derivatives of price action.

An example of a technical analysis price indicator may be a Moving Average or MACD. Stock signals can be given on thousands of trading methods.

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An example of Moving Average

 

Trading stocks can be extremely lucrative when you are able to find trading signals that are proven to be effective.

Trusted stocks signals help you predict the market investing in stocks with live trading signals sent directly to your device, in the app you will be able to get live rates on hundreds of different assets.

How does stock signal app work?

The software scours social media and accumulates posts, comments, etc that include keywords of interest.

All this data is then filtered and crunched to produce interesting statistics. Showing the true public opinion using their words, giving in-depth insight into public minds.

Market signal

Market signal is indication or information passed passively or unintentionally between participants in a market.

For example, a firm issuing bond indirectly indicates that it needs capital and that there are reasons (such as the desire to retain control of the firm) for which it prefers loan capital over equity capital.

Every company doesn’t market in a static environment, the competitor and member of the outlet will make prediction and reaction to enterprises, their decisions process is a dynamic market mechanism. And based on rival actions or reactions.

The market signal is any activity of rival.

In order to understand rivals motive, intention and direct and indirect target news and competitive signals such as reduced price, new product introduction and adopting new engineering technology need to be understood.

The information delivers to the market mainly through the market signal. If we identify, search, study and analyze the market signal, then it not only take the strategic decision and contribute to analytical behavior trend but also to improve enterprise results.

For example, a well-reputed company can be judged by its income i.e. if its sales increases then its reputation in the market also increases.

Let’s take a look at the experts’ definition.

In contract theory, signaling is the idea that one party (termed the agent) credibly conveys some information about itself to another party (the principal).

For example, in Michael Spence’s job-market signaling model, (potential) employees send a signal about their ability level to the employer by acquiring education credentials.

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The informational value of the credential comes from the fact that the employer believes the credential is positively correlated with having greater ability and difficult for low ability employees to obtain.

Thus the credential enables the employer to reliably distinguish low ability workers from high ability workers.

Signaling took root in the idea of asymmetric information (a deviation from perfect information), which says that in some economic transactions, inequalities in access to information upset the normal market for the exchange of goods and services.

 

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Let’s suppose that two parties could get around the problem of asymmetric information by having one party send a signal that would reveal some piece of relevant information to the other party.

That party would then interpret the signal and adjust her purchasing behavior accordingly, usually by offering a higher price than if she had not received the signal.

There are, of course, many problems that these parties would immediately run into.

So we can say, the market signal is any action by a competitor that provides a direct or indirect indication of its intentions, motives, goals, or internal situation.

Forex signal

Forex signals behave like a trade alert for the currency market.

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It notifies traders when to enter or exit a trade.

Signals can be recognized into three groups:

News trading signals

Technical signals

Real-time trading ideas – Webinars

The first one in the list is the fundamental approach to Forex signals. The aim of this signal is to get the news release as quickly as possible and provide a trader to gain the maximum level of profit in a short time.

Forex signals often come with daily or weekly commentary and analysis.

Technical trading signals are simply trading tips on the basis of technical analysis.

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That means you trust the background and track the record of the provider of what you may consider being the best Forex signals service issuing certain signals. You may prefer to trade on this basis rather than enter your own orders.

Technical Forex signals are frequently issued along with different risk management strategies in order to ensure minimal losses if the current plan does not work out as it was initially expected.

Most online Forex signals tend to fall under this category, which can make the search for the best Forex trading signal provider a much harder and longer task.

General knowledge of Forex signals may help you in finding the best Forex trading signals provider.

 

Forex signals can be procured from various companies that specialize in this service, as well as from a number of top Forex brokers who provide them for traders of standard or VIP accounts.

Forex signal is an impulse for entering a trade on a currency pair, typically at a specific price and time.

The signal is generated either by a human analyst or an automated Forex robot supplied to a subscriber of the forex signal service.

Due to the timely nature of signals, they are usually communicated via email, website, SMS, RSS, tweet or other relatively immediate methods.

You have seen Searches related to forex signals, best free forex trading signals, accurate forex signals free, free forex signals live, live forex signals without registration, free forex signals providers, free forex signals online with real-time, forex signals review, free forex signals software

Services that you gain upon signing up with a Forex signals provider generally differ from firm to firm.

You might expect to receive almost anything from performance trackers, email, or SMS alerts, customer support via email or phone and, of course, advanced analysis of more sophisticated offers.

Because Forex signal service providers must protect their strategies, trading with them always involves blind trust, to some extent, in the chosen company or individual behind the issued Forex signals.

Types of services provided fall into four categories:

Unpaid/free signals

Paid signals from one provider whether by personal analysis or algorithmic analysis

Paid signals aggregated from multiple signal sources or ‘systems’

Signals supplied by trading software located on the trader’s computer, also known as a forex robot or EA (Expert Advisor)

What are the main services offered by forex signal suppliers:

  • Exact or approximate entry, exit and stop loss figures for trades on one or more currency pairs
  • Supporting graphs and/or analysis for the signals
  • A trading history showing the number of pips profit/loss per month and/or the risk/reward ratio and actual trades. Sometimes (especially in the case of forex robots) this may be shown as back-tested results
  • One-on-one coaching, or additional interaction with the signal provider such as comments, forum, etc.
  • Account management whereby a subscriber’s account can be traded by the signal provider
  • Educational resources either via the internet or phone
  • A trial period for a lesser price

These are the main features of a signal supplier, but all of the services don’t offer the complete list of services.

Are you going to use Forex signals or not will depend on your personality and trading plan.

In case you are a highly active individual with little time to spend on thorough analysis of the market, Forex signals offer an alternative to manual trading.

If you want to learn the mechanics of trading in detail, you will gain a very modest benefit from subscribing to these MQL5 Forex alerts.

 

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The appliance of signals depends on your level of proficiency in trading, your expectations and main goals. But there is one discouraging factor concerning Forex trading signals –  the high price.

But we found the broker who shares average historical spreads, both per broker and per trader. Only for you, our readers.

Stock trading signal

Trusted stocks signals help you predict the market investing in stocks with live trading signals sent directly to your device, in the app you will be able to get live rates on hundreds of different assets.

The advantage of a stock trading signal is the fastness of the decision. Many traders find themselves stuck with analysis and never really know when the best time to actually buy into a stock trade is.

Stock trading signals remove the trader’s emotion and indecisiveness that trading stocks can create for individuals. In addition, to buy signals, every trader should be able to get a sell signal from the system which is used.

But some traders don’t think that is necessary to use stock signals.

 

And they stand behind several reasons.

They claim there are several tools that a trader can use to get a good idea about future stock movement.

But they are talking about tools, you should keep it in your minds. Because even if tools indicate one thing, there is no guarantee the stock will move in that direction.

Others claim, if you’re paying a subscription for a signal service now, the only sure winners are the signal providers.

On the other hand, if someone somehow miraculously came up with an algorithm that generated enough income on a consistent basis that gave you enough confidence to leave your day job, why would such need to offer it to the public and risk diluting that working strategy?

The answer is that one wouldn’t because such one would already make enough money from the signals.

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Those traders believe that signal providers just make money from other traders or they would have been the richest by their signals.

Learn trading but not lean on trading is the point of their views.

We think that you should answer this question for yourself and find what really suits you and your trading goals. If you are planning your first start off with stock trading, you may have no ideas of how to make use of trade signals.

You should read a couple of resources and do some research yourself to come up with the right trading signals.  Also, you should open up your browser and start searching online for the best and reliable signal providers.

And you should check out some forums where you may see people were endorsing some site or not. You can feel a little confident and opt for some services.

That’s the small effort for good trade signals.

The market can give information on whether the company is valued as a going concern or on the basis of some anticipated breakup value. By interpreting market signals, the trader can compare its expectations with the market.

More important, the trader can better evaluate its operational and financial alternatives. Brought together these findings into a “market signals approach” may provide a systematic way to interpret market expectations.

The market can send out powerful signals.

In today’s market, there is a limited supply of companies available at a price that would give the acquirer an acceptable rate of return. To minimize the risks of buying an economically unattractive business or paying too much for an attractive one, traders must have good analytic skills or have a trusty signal.

Generally, the maximum acceptable price for a target company is its stand-alone value plus the value of acquisition benefits generated by operating, financial, and tax synergies.

 

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Reliance on signals, this approach can be costly in two ways. One is you have to pay to your signal provider, and the second, more important, is that you may make wrong choices if you don’t have good information.

For example, you want to sell some stock and in order to establish a maximum price, management can use market signal analysis in conjunction with standard acquisition analysis. Management can use the required bid to establish the market’s minimum expectations for the target company’s post-merger performance.

Shareholders’ returns depend on the difference between the expected level of company performance (implied by the stock price when shares are purchased) and subsequent performance.

If the current stock price implies that the company can earn higher returns than its cost of capital, then lower subsequent performance will likely reduce market expectations and share price, even if investments are made above the cost-of-capital hurdle rate.

Do trading signals work?

The answer is Yes!

Of course yes. A successful trader can be a great signals provider.

They work but you have to follow instructions, do right money management and choose the good signal provider that show real performance, not scammers.

Off course there are signal providers which work.

Some are even free of costs to you, some work on a subscription basis. The problem is to find the right signal on these platforms.

Yes, they do.

They work.

But it has to combine with the overall market scenario as well. Awareness about the happening in the financial world on micro and macro levels is important to fully trust a trading signal.

Trading signals always require a stop loss to be put along while following a signal.

Trading Signals are meant to be assistance, not reliance.

One should never ever follow trading signals blindly. Always do your own research before investing in any asset class be it forex crypto or stocks. Signals should serve as a good confluence for trade setups and you should never ever follow signals blindly.

That helps!

For example in Forex trading.

It is possible to find a number of courses for FX signals. There are a lot of websites that are dedicated to such a service, and social media makes it possible for people to share Forex signals free versions and premium versions.

There are three main groups of people that are responsible for sending such signals out:

Traders

Affiliates

Scammers

And you will see, many of them are scammers but a very few honest people are still out there.

Forex trading signals serve as signposts or indicators of when/how to act on a particular currency. It is important for investors to know how to read signals. Trading signals come in a variety of designs, from bear/bull designs to geometric shapes, and can bring attention to important currency details.

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Bear/Bull Trading Signal

Why an investor must know how to read these things?

For the same reason drivers have to learn how to recognize road signs: if you don’t know what the signs mean, you could end up ruined. Forex signal trading cannot be taken lightly. It is home to a rapidly changing the environment where some online brokers manipulate the original data feed to cause errors in the marketplace and earn a profit over them.

We show you these groups in the order in which they can be trusted.

It is common to find traders that are looking to share their ideas with the outside world. Their main aim in doing so is to earn a reputation of being a good trader, help out other people, and simply support the place that was once supporting them when they were new to FX trading.

Usually, it is possible to find traders that are sharing FX signals free on various forums. What does such a trader, signal seller try to aim?

Traders try to send reliable signals by performing their own analysis and providing exactly the same information that they are using in their own trades

Affiliates represent another group of signal providers.

You can get free daily Forex signals from this group once you have signed up for an account with a broker using their affiliate link. This way affiliates can still make a commission on the trades you make, but the signals remain free to you.

However, not every person has enough time to support both his affiliate business and his trading activities, so you should be cautious about this group of signal providers. Sometimes the quality of their signals may drop because they put more accent on their own promotion.

But you can still treat such signals with a decent level of trust.

And remember, it is a must to have former testing of their daily free Forex signals on a demo account.

Scammers are the people you should be avoided, because they are only interested in making an affiliate commission from you, or just making you purchase their ‘free’ signals.

Such providers usually employ quite obvious methods of attracting clients.

They provide a few free Forex signals online and later ask you to buy premium signals. After you have signed up for free, you will be sent some signals, but they will do the same to the other people that have signed up.

Some of these people are going to receive BUY orders, others will be provided with SELL orders. This way a scammer can split his audience in half. The first 50% is going to be profitable and the other 50% will be losing.

So do not fall for scams, as they cannot deliver anything close to the best Free forex signals.

Some trading signals/strategies work very well as long as they aren’t “overused”.

You can have a go with them and see if they can produce what they claim. They have to let you know the result.

If they can’t, never subscribe to that signal service!

Is copying Forex signals feasible?

Forex signals are a wonderful choice for people who do not like or want to make trading decisions on their own.

Maybe they don’t have a lot of time to trade or want to modify their own trading endeavor with signals from a pro?

There are so many reasons why some trader should choose forex signals.

A lot of people promoting Forex signals services, in order to oversimplify the signals following process.

They make it sound so simple and effortless.

But that the signals follower quickly becomes frustrated when finding out it is not as simple.

Do Forex signals work depends on what you want from your Forex signals.

  • If you want to turn $200 into $15,000 in a few months?  No, Forex signals will not work for you.
  • If you want to win every trade, every week and every month?  No, Forex signals will not work for you.
  • If you want to systematically participate in the Forex market over the long term and slowly grow your wealth.  

Yes, Forex signals can work for you if you choose the right service.

It is unbelievable how many signals services are impossible to follow in the real world and how many signal followers have unrealistic and inaccessible goals when joining a signals service.

If you want to have a good experience with a Forex signals service there must follow these two things:

  • You need to use a Forex signals service that is designed so the signal follower can get similar results to the service with relative ease.
  • You need to align your expectations with reality and understand what can and what cannot be accomplished by following a Forex signals service.

We all know how this can be difficult. The point is that if you don’t have any previous training experience you will not be able to know what reasonable expectations really are.

We are surrounded by all the hype of quick and large profits and it is really hard not to be misled.

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An example of a Forex trading signal

But, the simple answer is: Yes, copying forex signals are feasible with one condition: Forex signals can work if you find the trusty service.

You need to find the trusty service that you can trade and that realize your expectations. If not, you will constantly be disappointed and keep searching for something better.

The best way to figure out if Forex signals work and the service is suits you is to take a trial.

However, there are several things to consider and precautions to take before, during and after the selection of a forex signal provider.

This kind of business is very competitive and so a trader needs to get the most accurate, timely and up to date signal. These signals should also be accompanied by detailed analysis, explanations, and insight.

This will enable the trader to be successful in his or her trading pattern as far as profit making is concerned.

If you want a reliable Forex signals provider, use this one.

Types of Forex signals

Signals are basically electronically transferred bits of information that you can opt to receive via your email on your PC or your laptop, as well as your mobile phone. It is no matter where you are, you can receive this critical need-to-know information.

Signals inform you of the best times to purchase or sell the asset you are actively trading in. It also lets you know when you should place profit limit orders or protective stop loss orders that are critical to your financial good.

Forex trading signals are normally referred to as entry and exit signals. They have to be a result of detailed analysis, research, and tracking. When the signals are transmitted to you, keep in mind that they are only considered as accurate and active for a brief period of time. So, you have to react quickly.

The type of signal is determined by the specific function it may have and how it generally operates.

Technically there are two types of FX signals which are permanently available in the Forex market, and they are:

  • Manual Forex signals
  • Automated Forex signals

When the first type of signal is used, a trader has to sit in front of the computer for a large amount of time, looking for signals to make a final decision on whether to buy or sell a certain currency.

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An example of Forex daily signals

The use of these Forex daily signals has an interdependent connection with manual trading. A trader is able to assess the Forex market in a way that programs don’t. They can see when it is moving in an unpredictable and awkward manner, and thus is able to pull out of trades.

The trader has certain skills and experience and isn’t just limited to codes and programmed settings like automated systems, so they can get a feeling as to whether certain trades will be profitable.

The most popular type of Forex signal is copy-trading signals.

The clue is in the name, as to how they work. It involves following the trades of other real traders and copying the trades that they make. There are a number of different copy-trading signal providers. Traders are given the opportunity to enter the service to become signal providers, but there are usually a number of specific requirements, such as set trading volumes.

Other traders can choose to use the platform and follow these signal providers. Copying another person’s trade can happen automatically, or the signal service will send a notification and then it’s up to the individual trader to execute the trade manually, should they want to.

It is usual for this type of signals service to charge a subscription fee or take commission from a trader’s profit.

 

The signal providers who are being followed charge commission on the profits of the traders that are following them.

This type of signal service has become very popular because all the participants in the business only make money if the traders using the service make money.

The significant about automated Forex signals is that the trader only commands the software to seek what signals to look for. The human psychological stress is completely removed.

There is the software which will automatically interpret what action to choose: buy or sell a concrete currency. Trading in this manner can be quite accurate as long as the program has been done in a proper way and by a real professional.

The software can process much more data compared to a human Forex trader.

 

So, you are able to manage several currency pairs at one time. And you are also able to monitor all the charts you desire 24/7 and without missing any significant signals.

But the most successful appliance of signals is utilization a hybrid of both types.

And that is what the most Forex gurus do.

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An example of Forex automated signals 1

This type of signals service doesn’t use real people to generate the signals. Instead, these are automated or algorithm-based signals, which scrutinize various charts and make predictions and can be relatively accurate Forex signals.

This type of Forex signal uses the same tactics and strategies a manual trader would use, but there is no human emotion involved, just a set of clear-cut rules to follow.

Fundamental and technical analysis, along with a variety of indicators are used to uncover any developing trends.

 

Trends are predefined and often predictable movements of currency pairs, and once the software has uncovered them it sends a signal to the subscriber and advises them to make the appropriate investment.

Automated Forex signals can be quite accurate, but historically, not all have proved to offer the same level of accuracy. So much so that a large number of traders still prefer signals generated by a real live human being.

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An example of Automated Forex trading signals 2

But not all automated signals are cut from the same cloth, and there are some that do make relatively accurate predictions.

Many traders, even some of the most advanced, choose to use signals generated by algorithms on a daily basis. However, they will tend to evaluate the signal themselves before acting on the prediction.

Both manual and automatic Forex trading signals can be received online.

A trader can obtain forex signals from specialized companies and top forex brokers, generally at a low cost somewhere between $5 to $10 a day and more for monthly rates.

Trade signals can also be combined with fundamental analysis to give investors another weapon in their stock trading arsenal.

In volatile markets and/or with high-beta stocks, using trade signals can be invaluable to investors and traders. Not only to point out promising opportunities as they appear but also to signal when they may disappear.

When you want to buy, check first that the signal offers you a free trial. That will allow you to test the information, and make sure it is good quality before buying it.

To ensure that a trader is obtaining the information that will benefit in the end, they should only cooperate with companies who are willing to provide previous, evaluated results.

Moreover, those firms who validate their information are much easier to trust rather than companies who refuse to grant traders a free trial and access to audited results.

That is without the doubt the policy of top Forex signals.

But we have to say, fraud can be a problem when dealing with trading signals. As the forex market attracts a wide and diverse audience, the reliance on information for making financial decisions can be a crucial asset to investors.

The possibility exists that some trading signal providers will provide insufficient or inferior information at a premium cost to investors, which can impede or damage an investor’s ability to make the best decision they can in the market.

The best way is to do your own research the trading signals organizations and considering the advantages/disadvantages for each one before making any kind of financial commitment to one of them.

Read more about automated trading

Who are Forex signals providers?

Almost every Forex trader with a reputable trading system dreams of starting their own signal service. Imagine having thousands of customers following your trading signals for a $49 monthly fee. Isn’t that something everyone dreams of?

So, let’s say, the signal provider is a trader who grants access to the data on his or her trading operations allowing other traders to copy them on their own trading accounts. Signals can be provided either for free or on a commercial basis.

To become a Signal Provider, you need an active MQL5.community account.

 

Forex signal provider is a trader who trades on his own live or demo account and sends the same forex signals online to his followers. In most cases, this process is automated and takes literally no time.

Trading With Signals 21

 

Screenshot from MQL5.community

 

The signal provider doesn’t have to do anything manually to send forex signals indicator to his copiers. With a wide variety of forex signals services available today it is important to learn how signal providers are selected and ranked.

There are a lot of platforms that allow anyone to register and start selling signals without any preliminary verification of traders experience, knowledge or ability to manage risks.

Since after registration trading results of a signal provider are displayed publicly, users can make their own analysis to determine whether the strategy worth following.

But there is another approach: the trader must fit certain risk/reward requirements and volatility levels before being accepted as a signal provider.

This method helps trader make sure that signal seller only offers reliable strategies and don’t accept high-risk ones for copying. It also fits well into copy trading advice and regulations of many countries.

All providers are then ranked based on proprietary Forex signal indicator algorithm that takes into account maturity of a strategy (how long has it been executed for), maximum drawdown, regular profitability, volatility, average number of simultaneously open trades and many other parameters.

But, remember that this is an extremely competitive arena.

Due to the fact that information is so accessible via the internet, you can receive it anywhere as was mentioned above, so that you have round-the-clock access.

A Forex trading platform or “hub” gathers the necessary information in order to transform it into the signals that you receive. An additional safeguard is present in the fact that Forex companies are extremely careful and consistently pay attention to details when sending these signals to the various brokers, dealers, and individual investors.

Many, many forex traders are looking for quick money, getting rich in several weeks.

 

Some forex signals services may have a good run for a few months and then it’s game over.

A lot of these guys use crazy stops and those that do use stops use loads of taking profit orders. A professional service will not give so many take profit orders and tell the subscribers to pick one or do whatever they want with it.

Being a forex signal provider is measured by consistency. If there is no consistency it is a waste of money. Any signal provider that promises money or big profits is lying to you and to itself.

No one can guarantee that you will make money, because there are good months and bad months.

Selecting the right profitable signal provider is one of the most difficult tasks especially for the new traders.

You can find some instruction HERE

 

How to pick the right signal provider

Many forex traders use forex signal providers to help them make money. Traders who struggle to make profitable trades in the forex market can leverage off successful forex traders by using their signals in their trades.

Not all the forex signal suppliers out there are authentic and attempting to make sense of which ones are con artists and which ones are genuine can be an overwhelming assignment.

Finding a reliable forex signal service can seem like a challenge.

 

There are those signal providers that are professional and transparent.

And unfortunately, there are those providers that do not always have their members best interest in mind. It is up to you to do your due diligence to make sure that you are working with an honest forex signals provider that you can trust and have faith in.

There are several thing traders would consider when are going to pick your signal provider. A trader should be aware that there are a lot of hardcore scammers in the market working very hard to provide fake, low quality and substandard forex signals.

Most of these hardcore scammers have no background or training in any financial matters and usually feed the trader with performance statistics that are imaginary but yet convincing to a trader who is not smart enough.

The best way a trader can deal with this problem is by spending at least 5 minutes looking at what other traders are saying about this respective signals provider.

This will help him or her in making an informed and proper judgment.

Another way is by the trader looking at the level of detail contained in the signals provided by the forex signal provider.

If he or she realizes that it just entails a few charts with a loss or profitable line, the trader has a reason to think twice before following such signals.

A trader should look for testimonials about various forex signal providers available in the market. A trader should look at what other players in the industry are saying about the available signal providers. This will enable the trader to choose the best provider in terms of accuracy, quality, timeliness, and affordability of the services offered.

The trader should check the number of TPs the providers have in one trade.

The trader should check how the providers put together the performance statistics.

The trader should also check if the providers have a trade by trade statistics.

The bottom line is that any trader who wants to be profitable in the long term should start learning by himself or herself about forex signals through experience and self-training.

If you search for forex signal suppliers on the web, you will most likely be unable to recognize the sites of scammers from genuine suppliers.

 

Their sites are so comparative and competitive. Sometimes you can feel that clueless forex merchants typically get gotten in the scammers’ site rather than the genuine forex signal supplier.

When they understood that the signal is not profiting, it would have been past the point of no return. The scammers had officially taken the cash and it is past the point where it is possible to do anything.

Signal providers will give you entry and exit signals but remember you have no idea how they came up with the entry and exit points, all you have to do is follow. With all these promises, you will be tempted to subscribe.

That is the moment it will dawn on you that whatever you have subscribed to is a pack of lies.

Forex Signal providers are typically separated into two different groups based on how they generate their trading ideas – technical analysis and fundamental analysts.

 

Technical Analysts

 

They base their trading decisions on chart analysis including support and resistance levels, candlestick patterns, price channels, market structure, or other technical approaches. Many technical analysts have a proprietary method for analyzing the markets and the highly successful ones have spent many years researching and testing their methodology over historical data and in real time market conditions.

 

Fundamental Analysts

 

Who base their trading decisions on economic and news related data. This could be in the form of long-term interest rate analysis, inflation, central bank policy, employment reports, sentiment surveys, and more. Some are longer-term position traders while many others are shorter term traders that try to catch volatility spikes after an anticipated news release.

Trading With Signals 22

Some trader may think “reliable” means having a high win rate, but that is not really what you primarily want to be looking at.

Actually, win rates are not that important as a metric by itself. You must also analyze the average risk to reward in conjunction with win rate.

There are strategies with 90% win rates that can lose money and then there are strategies with 30% win rates that can make money.

Another factor to consider is the technology the signal provider is using.

 

Do they have a reliable platform to send out notifications and are there multiple ways for you to receive the alerts?

Something else to look at is the depth of detail that the forex buy sell signals provide. Do the trading alerts always provide stop loss levels and targets or do they only provide superficial information such as entries but no exit details?

These are some of the factors you need to consider.

So how can you find out if a provider is reputable and worth your time?

Sign up for a Trial

Sometimes this the best way to get started is by signing up for a forex signals trial. You may get a real sense of the quality of service by diving in and taking a test drive. Many providers offer a 1 or 2 week trial for members.

Join their Email List

Another way to find out the quality of information you will receive from a provider is by joining their email newsletter. You will find the value that they provide for free so that you can evaluate whether their premium forex signals service will meet your expectations.

Check their Track Record

All reputable FX signal providers will provide a performance record detailing their published trades. This is a good way to find their average pip profit per month, their risk parameters, average win percentage, and other related metrics.

Google them

Yes, simply Google them. Are they mentioned in any important trade publications or articles? What type of social following do they have?

Do everything possible to find to whom you are dealing with. Just don’t be one of those naysayers.

Check it, try it, test it and make your own conclusion.

How to select trading signals

Your beliefs are the most important driver of your trading signals. You must have the right trading signals to guide you in the intensively competitive environments you will find in the stock market, futures, forex, and options markets.

The challenge is that it is not as simple as finding the one best trading signal because just like everything else in your trading system, your signals should be based on your beliefs and your trading strategy.

If this is not the case you will have trouble pulling the trigger when you get a signal because the way you enter and exit the market should be based on what you believe about your trading strategy and how the markets work.

Your beliefs about the market are the most important determinant of your ideal trading system.

 

The first step to ensure you choose a trading signal which matches your beliefs is to document your beliefs about trade setups, entry signals, exit signals, and initial stop losses.

Some traders believe that there is absolutely no value in using trial and error trying all different entry triggers / buy signals/sell signals hoping to find something that works.

Trading With Signals 23

According to such traders, trial and error in trading signal selection will result in a curve-fitted, worthless trading system.

That can be true at some point. When you use trial and error all you end up doing is curve fitting to past data. You can get a system that works fantastically well on past data but doesn’t work tomorrow or into the future.

Maybe, for that reason, it is better to start with your beliefs and your trading strategy and select trading signals that support these to reduce your chance of curve fitting.

When you change your approach you can found enormous benefits which included:

  • Greater clarity on objectives
  • Reduced need for optimization
  • Greater real-time profitability
  • Reduced development time
  • Simplified system design

To be clear.

The internet is a wonderful tool, but the vast amount of information and companies/people dispensing forex trading signals and advice can be daunting and confusing to newer traders.

Advanced traders already can recognize what constitutes quality versus hype.

No one forex signal service will ever meet the needs of all traders, but a good service must.

Few trading services post their performance. There are several reasons for this:

The performance is simply not worth showing as it does little to inspire

The raw data, no matter how robust, falls on deaf ears.

The first consideration is that looking for a trading signal that generates a profitable trade on its own is nonsensical.

You can come up with the best entry signal ever designed. But, unless you have this rule as part of a complete trading system with all of the required components working effectively together, then there is no way you will make money in the long run.

A complete trading system needs each of the following:

Objectives

Setup

Entry trigger

Initial stop loss

Exits

Money management and Position size rules

The trade entry trigger is just one part of the complete system. Many people also suggest that it is the least important part of the system. Entry triggers are the area most prone to curve fitting, over optimization and the random noise in the market. It is really how you exit a trade once you are in that determines how much profit you make from it.

Remember, simple is better than complex; fewer rules is better than more rules.

Complex trading systems with many rules may not perform well in the future.

This is because it is more difficult to curve fit a simple system with few rules to past data, but if you have many rules and complex manipulations you can very easily fit your system to the nuance of past data. This will render it largely useless in the future!

One trader told me: ”Use simple trading signals that fit your trading strategy and beliefs”.

That helps a lot. And THIS ONE TOO

How to use trading signals

When you have signed up with a service to receive online forex signals, you will receive trading alerts via email, SMS or both as you like. You should choose some notification modality that will allow you to receive the alert in the fastest way possible. Many trade alerts are time-sensitive in nature, you know that.

There are countless ways that you can utilize the issued trade alerts. Depending on your priority, you may decide to follow the trade signal and initiate the suggested trade after you have confirmed that it meets your objectives.

Many inexperienced or part-time traders prefer this type of hands-off approach where they can use a forex signals website to do the heavy lifting when it comes to time-consuming market analysis.

Some other traders prefer a more hands-on approach.

 

They prefer to utilize the trade alerts as a secondary or confirming indication of their own market analysis.

For example, short-term traders may take trades using their own system but trade only in the direction of the online trading signals generated by the signal provider. There are many other ways that signal users can use this type of favor to complement their trading.

How many signals do you need to receive per week or per month?

That is the most common question. You should be aware that many times it will vary. When volatility in the market is high, you may find that you are receiving more daily forex signals than average, and when volatility in the market is low, you may find that you are getting less trading signals online than average. This is normal and should be expected.

Trading With Signals 24

Rookie trader wrong believes that the more often he/she is trading, the more money can earn in the markets. This is a mistake and often the reverse is true.

It’s not the number of your trades that matter, it’s the quality of your trades that make the difference between a winning and losing track record.

Remember, patience is a virtue in trading. It is more important to pick your spots rather than trying to be in the market all the time.

Most top forex signal providers are aware of this and act accordingly.

You have to consider this and remember that not being in the market is also a valuable position at times.

Trade signals can be used in technical analysis where are a major component, but fundamental analysis, quantitative analysis, and economics can also be applied.

Beside simple buy and sell triggers, trade signals can be used to modify a portfolio by determining when it might be a good time to buy more of one particular sector.

Bond traders may have signaled to modify the duration of their portfolios by selling one maturity and buying a different maturity.  It can also help with asset class allocation like shifting money among stocks, bonds, and gold.

There is no limit to how complex a trade signal can be.

 

But, traders tend to keep things simple by using only a handful of inputs.

We have to admit, it is far easier to manage a simple signal generator and periodically test it to see what element need balance or replacing. Too many inputs would initiate complexity requiring more time and skills. And we all know that complex strategies may become outdated before testing is even finished.

Using trading signals means that you can trade immediately, as soon as the notification comes. Services will provide you with additional means for trading as well, such as allowing you to do trade through a smart device like a mobile phone or tablet.

Signals can be hugely beneficial to traders of all kinds, from the most experienced to someone just starting out.

How to know if Forex Trading Signals is a scam

The best forex scams are hard to spot, so we would like you to be able to identify the most common tricks used by dodgy forex sellers. Most of the scams were interrupted thanks to the enforcement of rules by bodies such as the FCA. But today we are faced with more advanced scammers.

Of course, not every forex signal is the scam.

There are still very reliable services but it can take time to recognize them. First of all, there are so many speeches about scams all around the forex. Don’t believe every word you hear. Just because someone offers poor quality, doesn’t necessarily make it a scam with the intention of cheating you.

Think about the intent of the sellers. If all they want is your money without making an effort to deliver, it’s a scam.

The opportunity of scamming still exists for many forex scams.

Scammers tempt new investors with a promise of quick fortunes through “secret trading formulas” or algorithm-based “proprietary” trading methodologies. Before choosing a broker or platform, go through your own search.

Forex signal providers may be an individual or retail firm that promises to trade your account or give you signals to enable you to make a kill out of the market. Some of them will promote their experience and back it up with a few testimonies.

Some promise very high returns and guaranteed profits, either through a managed account where the firm makes trades on the investor’s behalf or by trading using the firm’s trading platform. Most traders will receive some initially returns from the firm to give the impression that their trading has been a success.

Scammers will encourage traders or investors to invest more money. But at this stage or soon after the returns stop, their account is suspended and there’s no further contact with the firm.

The important to know is the fact that many scam firms claim to be FCA authorized.

How they can do it?

Many fake trading and brokerage firms will use the name, ‘firm registration number’ (FRN) and address of firms and individuals who are FCA authorized.

This is called a ‘clone firm’.

The scammers then give their own phone number, address and website details, sometimes claiming that a firm’s contact details on the Register are out of date. Or scammers might claim to be an overseas firm, and that’s the reason they don’t always have their full contact and website details listed on the Register.

Trading With Signals 25

An example of scam trading signals

Some scammers may copy the website of an authorized firm, making cunning changes such as the phone number.

When you want to pick your signal provider you have to check several things.

Credible forex signal service should have been verified in websites such as the Forex Peace Army.

Further, the trader shouldn’t pay more than a few hundred dollars for a good signal system.

Be especially careful of system sellers who offer programs at excessive prices and claim they can guarantee remarkable results.

Choose one of the many legitimate sellers who is decent and whose systems have been properly tested to potentially earn a substantial income.

Another problem is mixed of funds.

Without a record of separated accounts, the trader cannot follow the precise executions of their investments. If you don’t check this issue, you are opening the door to scams. Scammers can use a trader’s or investor’s money to buy houses, cars, and planes or just vanish with your money.

Scammers can offer an investor the false opportunity to have his forex trades managed by highly-skilled forex traders who can offer outstanding market returns in return for a share of the profits.

The catch is, this “management” offer requires the investor to give up control over his money and to hand it to someone he knows little about other than the hyped-up and often the completely false record of success available on the scammer’s website and booklet. And the trader or investor often ends up without money, while the scammer uses investors’ funds to buy yachts.

Although the forex market is not entirely unregulated. The forex spot market is completely unregulated and accounts for the majority of trades.

Some forex brokers do not deal fairly with their customers and defraud them.

How does it work?

Start as an unregulated broker.

Offer large incentives to recruit affiliates who then bring the clients.

Once the broker has a few million dollars in funds, empty the accounts, transfer the money to an anonymous tax haven and shut the doors.

Hard to believe?

If some signal seller claims that everything he or she touches turns into gold, and to the client too, don’t trust.

Trust me, I am rich!

C’mon!

Their model is a fairytale of sales tactics where clients are suckered into a free seminar, then persuaded to buy several thousand dollars courses, then upsold again to a more expensive course.

The tactics are so good the clients don’t even know they’re being cheated. The education they provide is nothing you can’t find for free elsewhere on the internet.

Pay them to teach you, start trading, and give them the opportunity to buy a Lamborghini. Huh!

Million Dollar Pips was one of the most popular strategies ever sold, but the developer never traded it on a real account.

How does it work?

Develop a simple automated strategy that trades a lot with a high percentage win rate.

Run it on a dozen accounts using a variety of settings.

After several months, pick the best track record and publish to Myfxbook or some other traders community site.

Develop a sales page detailing how “sophisticated” and “professional” the strategy is.

Buy an email list, contact affiliates offering a 50% commission on all sales, then launch!

A few years ago it wasn’t uncommon for someone to sell thousands of copies of such strategy.

This kind of scams will fail, there is no doubt. Like any other did.

Where the warning signs can be found?

If brokers won’t allow the withdrawal of monies from investor or trader accounts.

If it is impossible to withdraw money.

If enter or exit a trade during an economic announcement is not in line with expectations.

If the trading station doesn’t operate to your liquidity expectations.

The best way to determine if a signal seller can benefit you is to open paper money or practice trading account with one of the better-known forex brokers.

Be patient, and eventually, you’ll determine whether predictive signaling works for you or doesn’t.

The list of the biggest scammers you can FIND HERE on WYT’s Wall of Shame

How to avoid signal provider scams

We think everyone should learn at least the basics of how to spot Forex scams.

First, ensure you deal with signal service providers originating from locations you have heard of before.

Second, if they are authentic, their payment method should be one of the common online payment methods such as PayPal or credit card payments.

Listed down here are some of the attributes to look into before following a signal service:

The signal should have verified records of myfxbook, FPA, and other credible verification sites.

The rule is, if the results are not verified, just move on do not waste time or money on unverified results.

In most cases, you will not know on what basis their decisions are made on, so this makes the verification part very important.

Focus on signals with over 6 months record of profit and with over 100 trades.

If whatever is being shown as results are for less than 100 trades that means the statistics are not sufficient to make any judgment.

The result should be sufficient to offer statistical significance to inform your decisions. Again if the results are for less than 6 months, then the strategy could just be lucky and with time it may be proved wrong.

Make sure the signal operates with drawdown levels you are comfortable with.

This will vary from one trader to the other. Some traders have a greater appetite for risk some have low. If for instance, you take a strategy with 30% drawdown, that means 3,000$ could be in drawdown with an account of 10,000$ and you remain comfortable. So work with a drawdown that does not give you sleepless nights.

Don’t just focus on how much a strategy earns, take a look at its drawdown too.

Get a signal with reasonable performance or subscription fees. When you are subscribing to a signal service, make sure the fee charged is reasonable so that you are left with some profits. Unless you are doing this to test the strategy, this strategy will only make sense if you have a huge account.

As we said before, any forex signal service should offer a certain trial period or money back guarantee. They should allow traders to test before buying. If that is not the case, move on and don’t do not waste your money. If they don’t trust their strategy, why should you?

Signals should be showing the current open positions.

 

A signal may be showing huge profits yet the current open positions are in huge losses capable of wiping the whole account.

Trading With Signals 26

Just like in most trading scams, the scam will not only be in the service itself but in the manner in which it’s marketed too.

Most of these scams will promise you a billion dollars, and one has to stop and wonder why aren’t they billionaires?

Remember most of these fraudsters know that an aspiring user of forex signals will heavily rely on what other users say about the product. They can hire people to review them well. The rule in this game is, make your own search.

You should check the firm isn’t a clone firm by asking for their firm reference number and contact details and then calling them back, never use a link in an email or website from the firm offering you an investment.

Always be wary if you’re contacted out of the blue, pressured to invest quickly or promised returns that sound too good to be true.

You should seriously consider seeking financial advice or guidance before investing.

You should make sure that any firm you deal with is regulated by us and never take investment advice from the company that contacted you, as this may be part of the scam.

CONCLUSION

As you can see there are plenty of benefits using trading signals in this tutorial Trading With Signals.

If you trust the signal provider, then you are able to save a lot of time and keep your focus on other core aspects of your trading business such as risk management principles.

At the end of the day, many professional traders who have the experience to back up their claims will tell you that risk management deserves 10x the attention that entries and exits usually receive.

There is no limit to how complex a trade signal can be.

Traders tend to keep things simple by using only a handful of inputs.

Honestly, it is far easier to manage a simple signal generator and periodically test it. Just to see what components need adjusting or replacing.

Since markets change over time with great speed, complex strategies could be rendered obsolete before testing is even finished. That is the moment when trading signals step on the scene.

Why we published this tutorial?

WYT Finance truly believes that knowledge is power. And speaking about your money, knowledge is priceless.

We have written about trading signals, what they stand for, their types and appliance in general trading.

In particular, we wrote about how to define a top trading signal provider by providing theoretical information, and tips.

Our intention isn’t to encourage you to utilize signals, but rather to give you an understanding of what is available should you want to include signals in your trading strategy.

Remember, however, many benefits signals seem to offer, they aren’t a replacement for experience and real trading skills.

Build up your knowledge and gain a real understanding of the trading market before you start to rely too heavily on signals.

WYT Finance showed you how to choose the best from all these possibilities we just introduced you.

We hope that this ebook will be helpful for you and we wish you good luck in your future trades.

Good luck from WYT Finance Team!

Read our blog http://www.wasteyourtime.co/ and visit our Facebook page WYT Facebook and find us on Twitter https://twitter.com/LMWYT

We are preparing a lot of surprises for you.

See you around! Waste your time. Not your money.

Risk Disclosure (read carefully!)

About the author

Trading With Success - a guide for beginners 39

 

 

Guy Avtalyon is a data researcher that uses statistic models and unsupervised machine learning algorithms to determine trends in the market.
”The truth lies within the data.”

 

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