The Good News About Forex Automated Trading

I’ve received positive and negative feedback from a lot of you who have experienced forex automation. I don’t want to talk about the bad news quite yet. So what’s the good? Unfortunately, the good news mostly involves available API’s for developing your system and brokers that support automation. I haven’t heard of many success stories relating to forex automated trading. Here are some recommended API’s and brokers and some comments on whether I will explore them further.

Interactive Brokers has a free C++, Java, and .NET API. The C++ API does not come highly recommended from the one trader I received an email from but the API’s are free. He also goes on to say that, “Interactive Brokers is also good from a fund safety point of view, given they are one of the bigger brokerages. Commission is very cheap and they basically offer anything you can trade.” This seems to be the best option I’ve seen and definitely worth exploring further.

Another trader recommended Varengold Bank for trading via Metatrader. He says that he has “yet to find anything to come close to their service utilizing the Metatrader platform.” Varengold Bank is a German bank and has regulatory oversight by the German Federal Financial Services Supervisory Agency. Unfortunately I don’t have a lot of experience with brokers or regulatory agencies outside of the United States yet this may be worth exploring if Metatrader is the platform of choice.

Interbankfx with Metatrader comes recommended also. A trader who just recently started using IBFX states, “I just started live automated trading this week… They seem to be very EA friendly and come highly recommended.”

MB Trader comes recommended due to their “well documented API and you can develop and test your system on their demo servers for free. MB Trading is a relatively well-known firm inside the United States so this could be yet another option worth exploring.

Ninja trader comes recommended and could be a “good option that allows for testing and development for free.” It’s also broker independent supporting Gain Capital, Interactive Brokers, MB Trading, and more. I like options and with the multiple brokerage support, I may look into Ninja Trader further.

Other options include FXCM’s FSS or Forex system selector. Based on what I’ve read though, you really can’t design your own system. You can select from their own designed forex systems. I don’t see the benefit to this at all.

FXTraderLink provides a facility for automatically trading your account based on signals from a portfolio of signal providers. I don’t want to rely on a signal provider to “provide” me with wealth plus I don’t trust them. I’m not a big fan.

I haven’t even begun to explore any of these options yet but I will regardless of the bad news I’ve received from others. Is it possible to make money with forex automation? Unfortunately I cannot answer this. I’ve had a tough enough time making money manually trading but at this point, I’d like to try something else.

Popularity: 78% [?]

Did Brokers Prepare For NFA Requirement Changes?

I guess we'll find out sooner or later but Forexds has an interesting comment regarding the whole thing:

"I know that many of the small FCM fishes have become IB's to established FCM's in December or sold their books to the likes of FXCM. But ALL of the names you mention in your note have posted the higher capital (I know for a fact that MB Trading and FX Club have). Alpari is a new comer to the US, but very well established in Eastern Europe. The higher net cap requirement of $10m is no surprise to FCM and they've had months to prepare and get the capital in order. You wont get the DEC data from the CFTC site until 6 weeks from now, though."

For those of you that aren't versed in the common acronyms you see in forex, FCMs are Futures Commission Merchants.  IB's are introducing brokers (defined as a futures broker who has a direct relationship with a client, but delegates the work of
the floor operation and trade execution to another futures merchant.)  Some IB's may be fund managers and some could just be considered salespeople, "introducing" traders to a larger broker and taking a commission and a cut of the spread.

Popularity: 3% [?]