Forex markets offer plenty of opportunities to rake in profits, but you must trade wisely through careful analysis.
As a forex trader, there are several tools available to help you understand how the market moves, its impact on currency pairs and how to locate a potential promising trade opportunity. Forex signals are one of the most vital tools that you will depend on, when looking for your next tradewinning trade. A quick search online will reveal several options of service providers that offer various kinds of signals for you to choose from – be it free or paid, automated or manual, short-term or long-term.
In a world with so many options, how do you ensure that you’ve picked the best possible forex signals service to suit your needs, who is a reliable forex signals provider? For me, FX Leaders is one such reliable forex signals provider that is my go-to resource for a good range of trade ideas across instruments and timeframes. Here’s a guide that can tell you what factors to consider when selecting an ideal signals system that suits you.
Past performance reports: A starting point when trying to find out if a signals provider is reliable is their performance history. While most services promise great profits and many pips, you need to remember that no one can guarantee profits in forex trading. It is a matter of risk, taking chances, making informed decisions, and of course, luck.
A reliable forex signals service will be transparent and honest about their past performance. When selecting a signals system, take your time to study their performance history – how many signals they provided, how many signals were wins vs. losses aka win rate, drawdowns, and what the pip gains as well as percentage gains in the past few years were. Winning is great, but losing is an inevitable aspect of forex trading. However, understanding the difference between the number of winning vs. losing signals, and how big the wins and losses of the signals put out by the provider were can help you decide if it is worth trusting the service. Keep in mind though that while past performance is not a guarantee for future profits, it does serve as a baseline to gauge the signals provider’s reputation and if they are as good as they claim to be.
Hot tip: Try to evaluate the performance reports for at least the past five years before making your decision. The more data you have, the more confident you can be of your choice.
Experience of the team behind the forex signals: Whether you sign up for automated forex signals or choose to go with a provider offering manual signals, there is a team of professional analysts and/or traders behind the trade ideas. If they are experienced enough, the trade ideas they publish in their signals will have a higher likelihood of success than those put out by novice traders and analysts. Most signals providers will provide a brief background about their team, including the number of years of experience their analysts/traders have, which instruments and forex pairs they have the most expertise in, and their qualifications.
Hot tip: In a world with so many options, how do you ensure that you’ve picked the best possible forex signals service to suit your needs? For me, 1000pip Builder is one such reliable forex signals provider that is my go-to resource for a good range of trade ideas across instruments and timeframes. Here’s a guide that can tell you what factors to consider when selecting an ideal signals system that suits you.
User reviews: While it’s great to research a forex signals provider carefully by checking out their website, to really know how good they are, you need to hear it from their users. Find out what other forex traders who have signed up for a particular signals system have to say about their experience. You can access user reviews about signals providers on their own websites in the form of user testimonials, on online communities for forex traders, on social media, and even rely on word of mouth feedback from other forex traders in your own network.
While you’re at it, also keep an eye out for possible scams which unfortunately are prevalent online. Some forex signals services will take payments and fail to provide signals as promised, or will claim guaranteed profits and end up cheating consumers. In such cases, there will be ample user reviews on leading websites warning others and keeping you from losing your money.
Hot tip: Check out the social media presence of the forex signals provider. In this digital age we live in, most businesses are active on social media. If they have a large number of followers, it’s an encouraging sign. And even if they don’t have too many followers, if it looks like they engage with their followers actively and share posts regularly, take a look at the user comments on their posts to gain valuable feedback on their quality of service.
Range of instruments and timeframes: If you’re just starting out in the world of forex trading, chances are you’d like to take it slow and cautious, trading a select few currency pairs to begin with. But over time, as you get more confident, you may like to experiment with placing different kinds of trades and trying your hand at earning more profits. For this, you will need a forex signals provider that offers ample diversity in the signals they publish, across different forex pairs and different timeframes as well.
Let’s simplify this with an example: let’s say that when you start out, you would prefer to play it safe by trading only the major currencies and indulge solely in intraday trading. However, over a period of time, as you gain confidence, you would like to diversify your portfolio by trading emerging market currencies and even try your luck with placing some long-term trades. Now, if your forex signals provider offers only a limited range of options, you will have to go in search of an additional service when you choose to expand your trades. Instead, if you picked an experienced provider that offered a good distribution of signals across multiple forex pairs and timeframes in the first place, you can make the most out of such a service when you feel up to it.
Timely and effective communication: Trading is an extremely time sensitive activity and this holds just as true for forex. Whenever a forex signals system publishes a new signal or trade recommendation, you need to ensure that it gets communicated to you as soon as possible, in a manner that is convenient for you, so that you can reap the most benefit from it. Be it email, SMS, or mobile app notifications, ensure that the provider you sign up for reaches you via the medium that you are most comfortable with. The idea is to never miss a promising trade opportunity!
Compatibility with your trading account: This one is not necessarily a ‘need to have’, but can be considered a ‘nice to have’ feature. If your signals provider offers automatic trading options with your forex broker or trading account, you can place trades directly from the alert you receive with just a simple click of a button. This would not only be far more hassle-free than having to manually copy recommended levels from the forex signal into your account to place a trade, but would also leave no room for error when entering key levels for the trade.
Budget-friendly: And lastly, we recommend that you pick a forex signals provider that suits your budget. Service providers offer forex signals either for free or even on payment, and subscription costs can range from anywhere between $40-50 and even up to $500. Do note, however, that expensive need not always assure greater profits, like we discussed above. Whatever option you choose to go with, make sure it doesn’t burn a hole in your pocket. Remember, you may lose some of your capital on risky trade ideas as well. If you ask me, it would be better to pick an affordable yet reliable forex signals provider and use the rest of the money to place more trades in the forex market instead!
