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.

Comments

7 Responses to “The Good News About Forex Automated Trading”

  1. Scott on August 27th, 2008 9:36 am

    I would definitely include Tradestation in your analysis. Although they use Gain as the forex broker, the automated trading is awesome. Their EasyLanguage is fairly simple to learn, so setting up and backtesting strategies is not too painful. I have executed a real money automated strategy using Tradestation 8.3 for the last 6 months with good success, ie. profitably.

  2. Trader Rich on August 27th, 2008 10:58 am

    Thanks Scott. I didn’t even think about Tradestation…

  3. Stefan on October 17th, 2008 2:42 am

    Hello Rich,

    I’m hoping to send you an email one of these days, as I think we have had many of the same experiences over the last few years, and I would love to meet new traders with a passion for the forex market.

    Anyhow, back to automated trading: For the longest time I have been using the brokerage OANDA (www.oanda.com). They also offer an API, but was a bit pricey the last time I did some research into it. However, as a brokerage in general, I have had nothing but positive experiences as a client. They have a great Java-based platform (order entry/execution, as well as charting) and offer very low spreads – sometimes 0.9 pips on the EUR/USD!!

    All the best.

  4. Paul on November 7th, 2008 1:50 am

    Hi Rich, I am a newbie to Forex Trading, however, none of my Forex friends suggested Automated Forex Trading System. I dont know why. But your post clarified why they have not suggested. I have heard lot of about Automated system and I am very interested in this Automated Forex Trading. I would like to know your views on this, whether I should go to Automated system directly or should prefer simple system for until I get familiar with this.

    Thanks.

  5. sully on November 22nd, 2008 9:02 am

    I would venture to say that automated trading does not work and I’d be surprised if the above did work, I will look into them.

  6. Forextrading on December 2nd, 2008 6:33 am

    I agree with you that interactive brokers and API’s can make our trading system strong and provide us profit.

  7. ahmad kamal on February 16th, 2009 9:36 am

    you can make money using the forex automated system but don’t trust it 100% and the important thing is, you must have a good money management skill.

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