A New Era of Trading with SharpTrader Arbitrage Software

SharpTrader represents the pinnacle of trading software innovation. It is not just a trading platform; it's a comprehensive solution that brings together multiple arbitrage strategies under one roof. From Forex to cryptocurrencies, CFDs to Energies, and Precision Metals, SharpTrader is equipped to handle a variety of trading instruments, making it a one-stop solution for traders seeking diversity and dynamism in their trading endeavors.

Key Features of SharpTrader

1. Multi-Platform Compatibility: One of SharpTrader's standout features is its ability to connect with almost all known Forex brokers and crypto exchanges. This multi-platform functionality ensures traders access various trading opportunities across different markets.
2. Diverse Market Access: SharpTrader's multi-market capability is another feather in its cap. It allows traders to explore arbitrage situations in the cryptocurrency and Forex markets and CFDs, Energies, and Precision Metals, offering a broad spectrum for trading strategies.
3.  Innovative Arbitrage Strategies: The core of SharpTrader lies in its diverse range of built-in arbitrage strategies. These include latency arbitration, which exploits the latency discrepancies between different brokers, and various lock arbitration strategies, which secure profits and manage risks efficiently. The platform also features hedge arbitration, triangular arbitration, statistical arbitration, Bright Duo, Bright Trio, and L-Pouring strategies, each designed to optimize trading in specific market conditions.
4. AI-Powered Optimization: SharpTrader harnesses the power of artificial intelligence to optimize the parameters of its built-in arbitrage strategies. This AI optimization is based on analyzing trading outcomes, ensuring that the strategy are constantly refined and updated for maximum efficiency.
5. In-Depth Order Analysis and Custom Strategy Creation: The platform empowers traders to analyze each order and strategy thoroughly. It also provides the flexibility to create custom strategies using its built-in programming language, catering to the unique needs of each trader.
6. User-Friendly Interface and Manual Trading: Despite its advanced functionalities, SharpTrader boasts a user-friendly interface, making it accessible to both novice and experienced traders. It also supports manual trading, enriched with various built-in indicators and graphical tools, enhancing the overall trading experience.
7. Arbitrage Activity Masking: One of the unique aspects of SharpTrader is its ability to mask arbitrage activities. This feature is particularly beneficial for traders who wish to keep their trading strategies discreet and secure.
8. Presets for Different Trading Scenarios: The platform comes with built-in presets for working with different types of Forex brokers and prop firm contests, streamlining the setup process for various trading scenarios.

SharpTrader Arbitrage Software comparison analysis of the built-in strategies

To provide a comparison analysis of the various strategies within the SharpTrader Arbitrage platform, we can create a table outlining the key aspects of each strategy:

SharpTrader Arbitrage Software Tests

On the following graph, you can see SharpTrader with LockCL2 built-in strategies and cumulative results from two accounts from the end of October 2023 till December 7, 2023



In the following graph, you can see how the LockCL2 strategy masks arbitrage activity. Red pars shows the average order's length in hours, and green bars represent the average pips per order. 



Conclusion

SharpTrader is more than just a trading platform; it's a gateway to the future of arbitrage trading. With its wide array of strategies, AI-powered optimization, and user-friendly design, it stands at the forefront of trading technology. Whether you're a seasoned trader or just starting, SharpTrader offers the tools, versatility, and efficiency to enhance your trading experience.

Analysis of the forex market as a non-stationary time series

Analysis of the forex market as non-stationary time series is a difficult task because changes in the market can be speedy and heterogeneous. While the classical stationary time series analysis assumes that the statistical properties of a series do not change with time, in the Forex market, this approach may not be applicable.

Here are a few methods to analyze the forex market as a non-stationary time series:

• Time series differentiation: You can make a time series more stationary by removing the linear trend component or seasonality. Differentiation allows you to estimate the rate of price change in the market.
• Exponential smoothing: This method reduces noise and variability in non-stationary time series and improves forecasts. It is based on the fact that newer data is more important than older data.
• Wavelet analysis: Wavelet analysis can extract information from the forex market, characterized by heterogeneity, multiscale and multiresolution. Wavelet analysis uses functions that can describe the behaviour on different time scales.
• Autoregressive models with integrated moving average (ARIMA): ARIMA is a statistical model used to analyze time series. It is based on the principle that the current value of a time series depends on previous values, errors and a random component. ARIMA can be used to predict future values of a time series.
• GARCH models: GARCH models simulate non-stationarity and variability in time series, such as asset prices on the Forex market. These models can help in risk assessment and decision-making about market positions.

Any prediction of forex market behaviour using standard methods can be made only in areas close to stationary. For this purpose, the trader or forex analyst should single out areas relative to stationary.
The allocation of stationary areas on the forex market can be helpful for analysis. It will help to see a clearer picture of market trends and statistical properties of price movements. However, stationarity is not constant in the forex market, and these areas can be short.

Analysis of the forex market in areas close to stationary

Here are a few methods to distinguish regions of stationarity in the forex market:

• Decomposition into trend and residual: This method allows you to divide the time series into two components - trend and residual. The trend component is the general path of price changes on the market, and the residual part is random changes unrelated to the movement. After dividing the series into these components, the residual component can be analyzed as a stationary time series.
• Smoothing with moving average: This method smoothes the time series by removing noise and outliers. The result is a stationary series that can be used for analysis.
• Stationarity Tests: There are various statistical tests for stationarity of time series, such as the Dickey-Fuller and KPSS tests. These tests can help determine if the time series is stationary.
• Use of filters: Filters can remove the low-frequency component of the time series, allowing you to highlight high-frequency changes that may be more stationary.

It is essential to understand that stationarity can be rare in the forex market, and analysis of stationarity areas should not be the primary method of market analysis. It is also necessary to consider fundamental factors, news and other significant events that can affect prices in the market.
Both approaches are rather complicated and often do not lead to precise forecasting of the forex market behaviour. Why does it happen?

Forex market casino style

It is because many forex brokers and developers of trading platforms for forex brokers have turned trading in the forex market into an online casino, as in every way trying to make money not on the commission but on the loss of the deposit. For this reason, comparing any, even the best online casino with most forex brokers for retail traders, you will find many similarities:

• Deposit bonuses.
• Re-deposit bonuses
• Affiliate programs
• And much more.

Comparing the forex market to casino-style can be viewed from different perspectives. On the one hand, both have elements of risk and uncertainty. There are some similarities to gambling in the forex market, such as the possibility of quick wins and losses using luck, analysis and intuition.
On the other hand, the forex market has characteristics that distinguish it from the casino style. The forex market can use data analysis, economic theory, and risk management tools that can help reduce risk. There are also rules and regulators in the forex market that regulate trading and protect investors.
At the same time, risks are associated with forex trading, such as unexpected changes in currency rates and political and economic events, as well as risks related to leverage and inadequate risk management.
While some elements of the forex market and online casinos may be similar, the market has characteristics distinguishing it from casino-style. It is always advisable to assess risks and use careful risk management when trading forex to reduce the likelihood of losses and increase the chance of success.

The relationship between successful forex strategies and casino-style strategies

Analyzing the above, we can conclude a relationship between successful forex trading strategies and successful strategies to win at online casinos. And the developers of the process for online casino games are often faced with the same problems as those for forex trading. I say to begin to apply the martingale system in online or offline casinos; we will see that at some point, the number of repetitions of red if we bet on black, will be so high that the player's financial capacity will not let him win by increasing the bet on black. The same will happen in the forex market. At some moment, the deposit will not hold out, and the trader will lose it completely. With a high probability, the risk management worked well in both cases - it can be either the software or the dealer. But the main thing to understand is that the advantage of a casino and the advantage of a Forex broker is unlimited time and unlimited money, which the player or trader does not have.

The best strategies for forex trading

That is why when developing a forex strategy, you have to understand that the best method will be the one which is short-term and which does not use averaging or increasing the size of the position. Also, the strategy should not depend on any technical indicators. Even the economic analysis for short-term trading may need to be more productive due to speculative market movements. Therefore, the most accurate, profitable and low-risk strategies are forex arbitrage and trading on the news. Both of them presuppose a fast feed of quotations or news releases. Applying these strategies is possible only when the trader has the tools to mislead a forex broker's risk management.

Conclusion

This article is the first and introductory in the series of educational articles about such trading methods as forex arbitrage and news trading. Still, it allows traders to understand the overall picture and move in the right direction to financial success instead of wasting time and money on studying non-prospective market analysis trends.

When you combine this with the global economic outlook, it's safe to say that while bitcoin will end at a much higher price than what it's currently looking at now in November, it won't be what was expected by analysts and those in the industry thought 2022 was previously going to look like. Financial content providers and financial content authors mostly agree that bitcoin will mirror economic situation worldwide in the near future.

What happened that has pushed down BTC so much

In 2021, we heard of bitcoin prices hovering near the $70,000 mark. It was a huge bull market, and then 2022 hit, and so many factors occurred that may have helped bring Bitcoin to under $20,000 by November 2022. It's important that while no specific factor is an indicator of where Bitcoin is going, there were enough negative factors that definitely influenced the bitcoin prices going down.

In the world of crypto itself, a major factor was that uncertainty became a reality, and while there were signs of it everywhere, it all came to fruition when the Terra–Luna project became completely insolvent. The Terra project was working towards building an algorithmic stablecoin that was pegged to the US Dollar. That simply means that each token was worth exactly one dollar without the need to actually have that dollar.

That may be a liquidity dream come true, but in reality, it was akin to a concept of 'printing more currency', and eventually, the hyperinflationary bubbles ended up exploding. The stablecoin de-pegged from $1, and that had a cascading effect on the community.

Investment hubs such as Celsius and 3AC were heavily invested in the Luna token as well as UST, which was the stable token. In less than a few weeks, billions of market capitalization were lost, and hundreds of millions of actual client money also ended up disappearing into thin air. These companies quickly became insolvent, with frustrated clients out of their investments. This built a distrust towards cryptocurrencies, especially bitcoin. It was the opportunity for larger investment players to enter into this space, and instead, the results ended up being catastrophic.

To continue the journey of the big push downward for BTC, recently, there's been a major collapse of one of the largest exchanges on the current market, and that is FTX. FTX began its history with some smart people behind the operations and primarily made their returns with arbitrage trading, taking advantage of FX and discrepancies with pricing. This led them to be one of the top five exchanges that helped to build stability in the markets.

FTX was known to provide liquidity and work to bail out other firms, such as those mentioned above, that helped bring necessary liquidity and stability to the cryptocurrency markets. Unfortunately, FTX itself eventually crashed due to mismanagement, amongst other issues, in early to mid-November 2022. This eliminated any rally that was seen at the end of October and promptly pushed Bitcoin back down to $16,000 from a rally where it was around $21,000 comfortably.

These are just the highlights of an industry that has seen its overall market cap cut down by more than 50% in the past year, and it's understandable that as we approach the end of the year, there's really any direction Bitcoin that can go in.

How regulations have also affected the pricing

Regulations came down hard at the end of 2021 and throughout 2022 when governments were bringing regulations to exchanges accepting global users. It all began in mid-2021 when China announced an official ban on crypto mining (a way to produce bitcoin), and that cascaded down to those operations moving to different locations.

Yet then, more countries brought stricter regulations on centralized exchanges, and the KYC required an opening of accounts. This shone a light on an industry that was built on trustless transparency combined with anonymity, which also started having some players no longer interested in the markets as they once were.

Traditional markets also worked to push the pricing down as well

Markets were rocked this year as the end of the pandemic pushed economic issues to many of the major economies out there. The U.K. Eurozone and the U.S. faced record-high inflation rates that forced them and many other countries to combat these inflationary rates with interest rate hikes.

Since cryptocurrencies, especially bitcoin, are directly related to the cost of money, increasing interest rates adversely went on to affect the pricing of Bitcoin. With each interest rate hike that would occur in the US, there would be a subsequent decline in the price of Bitcoin as the price of the dollar went up.

That’s because safer investments such as savings accounts and bonds would be more appealing since the interest rates would go up, and cryptocurrencies were again affected by massive pullouts from the markets. The interest rates have also affected global markets, with key markets in the US underperforming and down across every sector. So while cryptocurrency should be trending opposite to most markets, it is also now starting to follow the wider markets as well and going down in tandem with them.

The markets are headed in this downward direction because of inflation rates going up, economies slowing down, and interest rates on the rise, thinning out people’s budgets and disposable incomes. While it's not a globalized recession yet, the signs are pointing to that and, thus, have affected the crypto markets drastically throughout the year.

The case for an increase in price by the end of the year

With all of this doom and gloom mentioned above, that’s actually great news for those that are looking to see where Bitcoin is going to end up at the end of the year. One thing is for sure, it won't stay at these stagnant prices, and all indicators are trending upward.

One thing to note is that it seems all the expected damage that could have occurred has occurred this year. People have tasted loss and have seen that the market is extremely volatile but, at the same time, is quite resilient. The overall market didn't collapse into zero dollars, and in fact, it is showing signs of stability throughout every action that has occurred that could negatively affect the market. For example, a major exchange – which is a major source of liquidity- did not deter the markets as much as it could, and now there are signs of a rebound and signs of life within the market.

That’s because of how cryptocurrency markets are. They never close and are open 24/7, trading globally all the time, which makes liquidity important, but there’s also a much larger pool to help maintain it. In fact, one exchange crashing down means other exchanges can pick up the slack. With that said, Bitcoin looks to be ending its price point at a much higher amount by the end of the year.

The price is expected to end above $21,000 by the end of 2022, based on sentiment and the resurgence of a bullish market. Keep in mind that the global economies, in general, had an effect and that the consistent rise of interest rates throughout 2022 helped with bringing down the price of Bitcoin as well. Since it also looks, especially in the US, that inflation is starting to hit its peak and slow down, the case to raise interest rates and thus make money more expensive will also disappear.

The case for Bitcoin to go lower

Yet while there's bullish sentiment across the markets, it will only take any new instance to break the confidence in an already fragile market. That means if there's any news through the end of the year of another instance of an exchange losing its liquidity or investment firms going under because of poor crypto management, then that could push the overall market, and bitcoin, down even further, even below it's once recorded milestone pricing of $10,000

While it seems unlikely through the end of this year, it's still important to note that it's still a possibility and to act accordingly. Then it can be considered to have hit a true 'rock bottom' per se, and thus can expect healthy rises and returns throughout 2023. While it is not the general sentiment with the way the markets are behaving, due to how volatile these markets can be, it’s important to always note that crypto market behavior is anything but traditional.

How bitcoin should look with the rest of your portfolio

Although not specific financial advice, it's important to note that Bitcoin tends to fall under a 'speculative' investment. Those types of investments tend to be the ones that can offer substantial returns yet come at much higher levels of risk and the chance to lose all your funds as well. At the same time, buy-in and regulations do help in the long term. So it's always a good idea to go with this as a small portion of your overall portfolio.

This will help to mitigate the potential losses that can be very real before you know it, and thus when you're trying to chase the immense returns that are given through cryptocurrencies; you don't have to put in the entire basket.

In the end

It's a wait-and-see moment for many, as people want to see what happens in traditional markets first. What will the recovery look like, and where will it be headed? That will help to alleviate local market risks and thus have a big push again into the crypto markets, which peaked as economies around the world peaked as well. We're in what is known as a crypto winter, so any positive movement is one that you should take notice of.

Yet Bitcoin is still considered the gold standard of the cryptocurrency markets, so it helps produce its own source of stability (since nearly 40% of the market is bitcoin). It will recover as the rest of the global markets continue to do so, entering the lucrative holiday season.

It's also the best option to look into when entering into crypto markets, as it tends to be a more stable option than another cryptocurrency. Don't let those words fool you, though, as Bitcoin itself has been known for huge swings, even with its current price point.

Keep in mind that this is only possible as the rest of the year closes out, without any other type of crash or failures happening either on the exchanges themselves or with the traditional markets taking a dive. That's why even if it seems there's room to grow through the end of the year past the $21,000 per token mark, it's still important to have a more patient approach.

The reason being is that if it does hit those highs, and there's a recovery throughout the crypto markets, then the estimates for the next year will only go up, and the returns potential as well. That means pricing per token of bitcoin is limitless, and it will be able to go much higher and faster than those traditional markets.

If you wait and a further dip happens, then there's even a better opportunity to be able to jump in and ride a longer recovery wave with better returns as well. So let's see how the year closes out and see if the estimates that people are discussing are hit. Then you, as an informed investor in Bitcoin, can make your decision accordingly.

As always, estimates and forecasts are just that, and what the year-end may actually look like could be nothing like what's been mentioned to us. But, again, this is because we still don't know how past market actions will continue with the current pricing and what the next one to two months will look like as well. 

Crypto currencies prediction content provided by https://financemarketing.net

Is arbitrage trading suitable for you?

Before talking about arbitrage, I want you to ask yourself the following question: Is arbitrage trading suited for me? What are the differences between involving yourself with arbitrage and other types of trading? When you are trading and using arbitrage, you will need to change your broker often, often will be worried that you aren't receiving profit, and will feel like you can't make money. At a certain point, you will understand that the broker is not your friend, and so on. At the end of the year, however, you will see that you have made more money than a trader who was calm for the whole year, and was friends with their broker, and ended up either suffering losses or making very little profit. If you are ready for these challenges, arbitrage is suited for you. The most important is that the change of trading style will also change the profit that is considered normal for you. Usually, arbitrage traders earn much, much more than traders who use any other method of trading.

Latency Arbitrage Explanation

I will start off by telling you about  latency arbitrage. Imagine that you and your friend are standing at the train station, and are don't know which train will go in the right direction, but two people do know which train is the correct one. These people are Usain Bolt and an amateur marathon runner, who are both running towards you to tell you which train is the train that you should be on. Obviously, Bolt will make it there first, and you will get on the train before the amateur runner gets to you. This is like latency arbitrage, where you have a source that delivers quotes to you much quicker than it does to many brokers, and you have a few milliseconds of a window to open an order in the correct direction.

In other words, this is very simple, but obviously, to create a tangible program that executes this strategy, lots of experience is required. You can learn more about forex latency arbitrage in this article. Programs that execute latency arbitrage also have a ton of setting sand presets to ensure that this order opens as quickly as possible. The most important issue, however, is masking this order from the broker as the broker does not support arbitrage trading. Hence my point from the introduction stands, the broker is not your friend. 

Lock Latency Arbitrage - 4 different algorithms

Lock arbitrage is a variation of latency arbitrage, however, orders open before the arbitrage situation in different directions with a different size of an order, on two different brokers. On broker A you will have a buy order and on broker B you will have a sell order, when you receive an arbitrage situation with the denomination of buy, you close the sell order and reopen it again. In this way, the broker does not see the order opening during the arbitrage situation but sees the closure of the order. In this way, this strategy allows a trader to work with the same broker for a longer amount of time due to the masking of this strategy. There are also many variations of Lock arbitrage, lockCL, lockCL2, lockcCL3, which were developed by our company and have various algorithms for entering and exiting the market, which also allows you to mask latency arbitrage from the broker.

Hedge Arbitrage Trading

So what is the difference between hedge and lock arbitrage, as many traders confuse these. Hedge arbitrage has a different idea in mind. Hedge arbitrage compares two brokers and their quotes between them, and as soon as there is a difference in quotes, for example, broker A has a higher price for EURUSD than broker B, then you sell on broker a and buy on broker b, fixing your profit. Then you wait for the opposite direction of quote differences and close your position. Hedge arbitrage works because brokers have very small differences in quotes that can be used to create profit.
Triangular arbitrage Trading

Another form of arbitrage is triangle arbitrage. In triangle arbitrage, to compare quotes, we use three quotes. A quote of a cross, say EURGBP, and the quote of EURGBP created artificially with two currencies: EURUSD and GBPUSD. When we compare these quotes, we find the difference and lock in profit, and then when the direction of the market changes, we create more profit using the market movements during closure. Before, this arbitrage was available on one broker, but now it is very improbable. Usually, two or three brokers are used in order to find the difference between the quotes of the cross symbol and the artificial symbol.

Statistical Arbitrage Trading

Statistical arbitrage works on the concept that some tradable symbols have a correlation, say if you compare gold and silver, you will see that these symbols grow or lose value with a very large correlation. Statistical arbitrage finds correlating symbols and trading happens on correlated symbols. At the moment where the prices divide, a buy and then a sell happens, the order closes and the trader receives profit. This is a non-toxic arbitrage variation and can be used on one or two brokers.

What is arbitrage trading in crypto?

So what is the difference between crypto arbitrage and the aforementioned arbitrage strategies? In crypto arbitrage, two variations of arbitrage are used. Latency arbitrage trading bot, where the source of fast quotes is used, such as exchanges with large volatility such as Binance. Likewise, hedge arbitrage is used when two exchanges are compared, and a buy order happens on one exchange, and a sell order happens on the other. The only difference happens as on many crypto exchanges in order to create an arbitrage situation on bitcoin; you need to have money in bitcoin. For Ethereum, you need money in Ethereum and so on. For hedge arbitrage involving crypto, a larger investment is needed, and as in forex, there aren't large shoulders such as these. Crypto arbitrage will result in less profit than on the forex market.

The most important question regarding beginning arbitrage is choosing a program and broker. The program for arbitrage needs to coincide with many settings, a company that has a good reputation, has experience with arbitrage, and is in the market for a long time can create a well-developed arbitrage program. This software is extremely hard to develop, especially a program which mimics manual trading, and the broker sees manual trading instead of automated trading. Along with this, the execution speeds need to be fast and feeds need to be extremely fast to be competitive as well.

Brokers for arbitrage trading

Choosing a broker is not an easy task. This takes a while since some brokers won't be compatible, won't work the way they are supposed to, or use plug-ins in order to create slippage which eats up the profit that you made. So why are brokers against arbitrage trading? The standard explanation by brokers is that you are causing harm to a server. This is not true. Imagine what happens when a broker, which declares themselves as an ECN, even though this term is not entirely correct, has thousands of people changing currencies in one way or another every second, and the broker's job is to deliver this information to the liquidity provider and then to the bank. The broker creates many short deals and makes a commission on each trade, and the broker should be happy about this. The broker however is unhappy as he is not trying to make money on commission, but rather on putting your account into B-Book.

This means you are trading against the broker. If you make money, that means the broker loses, and if you lose money, the broker wins. So the broker does everything in his power in order for you to lose and lose your deposit. So an arbitrage trader who has no ability to lose their deposit is very detrimental to the broker. Any claims of an ECN broker are not real, and you should not believe this. You need to check if this is truly an ECN broker or not. If you see that the execution time and slippage are very small you know that this broker is suitable for arbitrage trading, and you can prepare this broker to use them in an arbitrage program. Some traders tell us that the broker claims that arbitrage is illegal. This is not true, and there are many articles on highly reputable sites that explain that this is legal and helpful to the market. 

How to prepare your account for arbitrage trading?

To prepare an account for arbitrage trading, there are some steps you can take. Of course, you can just make an account and start using it for arbitrage trading. If this is a variation of lock or hedge arbitrage, you can use an account like this to trade, you will be profitable but soon the broker will realize that your actions happen during an arbitrage situation. This is especially true if the broker has plug-ins that work based on fast feed. This is why it is better to prepare accounts for arbitrage trading. There are many ways of doing this. You can use different strategies on these accounts, and the dealer which watches your account will believe that this is not arbitrage trading. The second way is to pour from your main account to another account. Pouring is using correlating currency pairs in order to make your account look like it's suffering losses. You will lose money on spreads and commission, but this will help you out in the long run, as upon seeing an unsuccessful account, the dealer will stop monitoring your account and will remove your account from their control. The ideal variation is using both of these strategies, first pouring from an account and then using other strategies which will keep the account at around 0. Then with the help of arbitrage, you can make a profit. After a certain period of time, you should redo this profit in order to create the illusion of loss. This constant change of strategies, the addition of new strategies, and pouring will allow you to work with the same accounts and the same broker for a very, very long time. Likewise, it is important to note that some brokers use quotes for currencies and CFDs from different sources. For example, CFDs could come from one liquidity provider and forex currencies from another, metals from another, and so on. The brokers look for the best conditions for them. This is why when you are looking for a broker, it is important to conduct tests for currencies, CFDs, and metals. This will allow you to find the most profitable instruments. If you want to trade using exotic pairs, you should also find a liquidity provider suited for you. I mean pairs such as German Crona, or Dutch Crona, and so on. To find the best arbitrage software you need to compare sevral of them. 

Arbitrage Trading Platform

The question which we are often asked is what platform is best to use for arbitrage, is this standard trading platform  or FIX API. This all depends on how much capital you have. If you have a large capital, over 10,000 dollars, then the FIX API broker will be right for you as you will be able to use FOK or IOC limit orders and you will be able to control slippage. The delay between FIX API quotes will be shorter than for or , therefore you will get fewer arbitrage situations. Learn more about SharpTrader arbitrage trading platfrom. 

AI's Influence on Arbitrage Trading

Another exciting application of AI is in the field of arbitrage trading. Arbitrage is a trading strategy that takes advantage of price differences in disparate markets or forms of the same asset. It's an approach that's been used for centuries, but AI is now transforming how it's implemented.

Arbitrage opportunities are often fleeting, disappearing in the blink of an eye. This rapid pace requires an equally swift response, which AI excels at. AI algorithms can process vast amounts of market data in real-time, identifying arbitrage opportunities when they arise. They can execute trades instantaneously, capitalizing on these opportunities before they vanish.

Moreover, AI can act as a powerful filter for arbitrage strategies, separating profitable opportunities from potential pitfalls. By analyzing historical data and learning from past trends, AI systems can predict which arbitrage opportunities will likely result in profit. This ability reduces risk and increases the likelihood of successful trades.

However, AI's role in arbitrage trading goes beyond identifying opportunities and executing trades. It also assists in risk management, an essential aspect of any trading strategy. AI systems can analyze market conditions, evaluate the level of risk associated with different arbitrage opportunities, and suggest the most suitable risk management strategies.

In conclusion, AI's influence on financial market predictions is substantial, extending from forex and standard trading strategies to the volatile world of cryptocurrency and the rapid-fire realm of arbitrage trading. As our understanding of AI deepens, and its capabilities expand, its role in financial market predictions will likely grow, offering traders more sophisticated tools and potentially more profitable opportunities. learn more...

Is Arbitrage trading profitable?

Using this program will allow you to mix strategies and use all of these strategies as a standalone. This will allow you to be more flexible and profitable in your trading. Using small deposits, you are better off using the or platform, as these brokers do not request large deposits to open an account, and you will be able to begin trading using only 100 or 200 dollars.

Often people report 1000% gains on the internet, and this can happen once, and this profit will likely be locked by the broker in one way or another. A realistic figure would be closer to 30-50% monthly profit. Hopefully, this article can help you make the right decision and help you understand whether or not you become an arbitrage trader. Good luck!

In reality, Forex cannot be fully automatic. Someone who wants to be a trader needs to put in the effort, just like any other job. It is essential to dedicate some time every day, and we have many clients for whom trading is a full-time job. However, we also have clients who use trading as an extra source of income and do not spend that much time learning the intricacies of the program usage. Regardless, effort and time are needed to be a successful trader. Installing and forgetting about a program is impossible in this competitive business. In our experience, such approaches lead to very sad results. We tried to create such a program that will allow the trader to start trading easily, not software that tells the trader to do this and do that to make a profit, but something that is easily accessible to traders who are looking to automate their trading further.

I will begin by dismantling some false stereotypes that I have observed over the years. I have heard that trading on the foreign exchange market can yield you 1000% profit in just days.

This is blatantly an untrue statement. A realistic figure is closer to 30-50% monthly profit, and as your capital increases, your percentage gains will decrease. If you come in with a deposit of 100 dollars, it is possible to make 50% a month, but with 100,000 dollars, you should expect 10-15% profit and so on. The higher the capital, the harder it is to make money. When you have achieved great successes in trading, and your capital increases to a very large amount, however, you will be dealing with different levels of brokers, different levels of instruments, and so on. This will cause your profit to be very stable, for example, 5% or 7% a month. These are figures which you should expect. This is a common stereotype which causes frustration amongst brokers, and although there are cases of 1000% profits, these end up with a blocked account and a long talk with the broker who will find a way to block you from withdrawing these profits. Our management is for those who want to make money steadily and in the long term.

The second opinion which we disagree with is the expectation of having completely stable profits. Stability in the long-term is possible, but for months where you generate a 50% profit, you will have months with a 5% profit. That is just how the business is. When we talk about steady gains and profits of 30%, we mean a strategy with a realistic profit margin achieved in some months of trading. If stability and a certain threshold of profit are required by you, then an office job fits the description much better than the volatile foreign exchange market. Unlike an office job, a steady salary is not guaranteed, as in any business.

The third mistake that traders make is trusting their brokers. Traders with existing forex brokers make the mistake of listening to their broker’s advice or taking their word as fact. If you arent ready to switch your broker from time to time and search for brokers, forex trading is not for you. Many brokerages start as clean companies and earn profit the way they were intended to. After a while, they change directions and go into b-book, start using all different types of methods which disallow the trader to make profits. IN this case, you need to drop this broker with no remorse. You always need to act in your best interest, as the broker will do this in a heartbeat. The reason why this is being outlined is that you need to understand this before you start. Knowing that the broker does not have your interests in mind in 99.9% of cases will save you a rude awakening as you get into trading.

There are also many forums and groups, which form based on advising traders. Firstly, many forums and groups have representatives from brokerage companies posing as traders to give flawed advice. There are also very inexperienced traders who believe their strategy is the end-all of trading. Although there may be some good advice on forums, it is very difficult to discern this from flawed strategical advice. Things that sound good in theory often do not work in practice, and following a strategy found on a forum may lead to quick gains, with a very large loss soon after. We believe trusting your knowledge and judgment and following a well-structured strategy is the best way to make money.

The choice of a broker will be outlined twice in our article. The first will be the initial choice of broker to learn about the FOREX market. If you are a beginner it’s important to choose a broker based on recommendations, for you to start trading seamlessly to understand the market. After this, we will tell you how to change your broker and why this is required. You need to consider some things before the choice of a broker, how the broker is regulated, where they are located, what reviews they have, which platforms the broker offers. The last criteria are important as we do not recommend starting to trade, for example of Fix API, as this is a more advanced platform. We believe starting on the platform is the most optimal as it is not an ideal platform and is created for brokers and not for traders, however has all instruments which will demonstrate the forex market. For this reason, you should look for a broker which offers either the or the platform, prioritizing as it is more simple to understand.

ECN Forex Brokers

1. GlobalPrime
2. Saxo Bank
3. CMC Markets
4. Interactive Brokers
5. TD Ameritrade FX

Next, you need to select a strategy. There are a PLETHORA of strategies, you can find descriptions of them online, but the strategy which works without a doubt will not be revealed to others and will not be outlined in detail online. Strategies can be divided into certain categories. It is important to understand if you will be manually trading at all or using a fully automatic strategy. The advantage of an automatic strategy is that you can test this strategy using historical data. This will not be 100% accurate as in the testing, many factors are left unaccounted for, and often testing is done using historical data which are tailored and more perfect than is seen in forex trading. However, after testing, you will be able to form an opinion on the strategy which you are using, rather than using this strategy manually, as this will cause you to learn from losing money. Even if you use the demo, this will cause a loss of time as it requires about a year for the market to go through all phases, as this will give you an idea of how the strategy operates. If you found an indicator that shows points of entry or exit, your job is not done, the indicator is just a small part of the strategy, it can help the trader create his strategy, but a strategy does not only contain entry points, but exit points, how stop loss is set, how to take profit is set, which money management is used, and so on. So I recommend starting with an automatic strategy or automating your strategy. It is better to automate it for the platform as this platform has better testing tools and optimization. The platform does not allow you to test using ticks, and many articles outline how to import ticks into the platform, but this is incorrect. This is because stores only open/close, high/low information, and loading ticks into the is just a myth. So if you want to utilize testing on ticks, you should automate this strategy for the platform and optimize it by testing it there. We can helo you program this as our talented developers have immense experience in coding strategies for any platform. After your strategy has been tested and works on the platform, you can code this strategy for other platforms that you are interested in. From the platform, it is best to switch to the Fix API platform, a financial protocol that allows you to work with brokers on a higher level, such as liquidity providers, and will enable you to use all real instruments. You can use FOK IOC and limit orders which help control slippage, and you can read about the FIX API platform and its benefit son our blog.

We start on the and platforms, and when we gain experience, we should switch to FIX API. FIX API brokers have some limitations. The first one being, that these brokers allow trading only on large deposits, usually over $10,000. IF your capital isn’t large enough yet, you should stay on the and platforms so you are not limited by just two to three brokers. If your capital is larger, you should move to FIX API brokers and use your strategy there or purchase a strategy that works with FIX API. As soon as you have chosen a strategy, which will be outlined later, you will need to change your original broker. Why is this? For example, you want to trade gold during moments of high volatility, and the liquidity may be low on your original broker. If your original broker is smaller, there will be less liquidity during highly volatile times, you will face slippage, and your orders will be rejected. In cases such as these, you will need to switch your broker. The second instance of when you will need to switch brokers may arise when the broker starts rejecting orders which are done during highly volatile times. So for each strategy, you will need to switch brokers. When you have optimized your strategy and tried it on the demo account, when you move to a real account you will need to switch your broker.

You should also select a VPS. A VPS is always needed, and you need to choose the VPS in the location of your broker. If your broker is in New York, you should select a VPS in the same data center. If you do this, there will be less lagging of time, as slippage on every order will cause you more losses than if you buy a VPS. You should never take a VPS from your broker, as in this case, the broker will be able to go on the VPS and see which strategy you are using. The VPS should be selected from a highly regarded VPS provider and never from the broker.

VPS Providers

1. UltraFXVPS (locations: NY, LD)
2. BeeksFX (Locations: NY, LD, TY)
3. FXVM (Locations: NY, LD, TY)

What kinds of strategies are there. There are thousands of strategies used in the Forex market, each one is different, and the optimal choice of strategy depends on how you envision trading. There are highly profitable scalping strategies, but scalpers often have a large distance set in their stop loss, so one loss will be colossal, and you will lose more than you made on 3-4 successful trades. These strategies are very sensitive to the broker that you use, and the broker can easily destroy this strategy using a plug-in; however, this is a highly profitable strategy. Arbitrage strategies encompass trading based on the fast feed, and there are many varieties of arbitrage. Latency arbitrage, hedge arbitrage, statistical arbitrage, and triangular arbitrage are all different and highly profitable with a very short stop loss.  Learn more about arbitrage trading- click to read An Ultimate Guide to Arbitrage Trading. This minimizes your risk. In my opinion, arbitrage is the best strategy to use when trading on the forex market. The catch is that you will need to change brokers ofter, but one profitable month will be profitable enough that it will cover the money you lose while in search of a new broker and small losses due to testing. Our company offers many programs for arbitrage trading. I can say proudly that this is the best product on the market, with no competitors on the market. The next way of trading is trading based on news. This is a more expensive way to trade than arbitrage as the trader needs to invest in a news feed, which is expensive, and companies that provide it want a large amount of money, 3 to 4 thousand dollars. We offer live feed to our traders and offer a program for news trading, but it will require extra funding. There are benefits to this type of trading, just one or two successful order entries can make profits for the trader, but you need to have lots of experience with news trading. You need to understand which news items you should trade, which you shouldn’t, and so on. You need to be able to understand very well things such as the importance of oil vs. COVID-19 or unemployment and what this corresponds to.

There are many on the market which are using grid strategies. Companies now sell grid signals or control accounts using gridders, and I recommend not get involved in such fads, as grids much like martingale, are very, very high-risk strategies. When you open a trade on a currency pair while using a grid, as soon as the grid goes against the direction of your order, there will be money pouring which under a strong trend will result in your account being completely nullified to 0. This is why we recommend avoiding any strategies based on a grid or martingale system. To be successful, this needs to be a grid with fixation; if you lose twice in a row, this strategy needs to be fixated to avoid more losses, which is often not done.

As I already pointed out in the beginning, money management needs to be more strict if you have a smaller deposit and softer if you have a larger deposit. If you are starting with 100 dollars, you want to make money; you can use more aggressive money management and enlarge your lots with capital growth. If your capital is large, I would recommend trading with a fixed lot and set goals that aren’t as ambitious as when you have a smaller capital. You will conserve your capital in this way and be able to work with one broker for a longer amount of time as the broker will make money on commission, and he will see that your profit is non-dependant on liquidity providers.

The purchase of a signal is very important as well. I would recommend the purchase of a signal in the case when you want to mask your arbitrage strategies or news trading. To mix arbitrage and news with other strategies, just simply buying signals isn’t the right course of action as usually all of these signals are not very high-quality, and you will start losing eventually. But when you have working signals and arbitrage trading ad the same time, the arbitrage will cover the losses of your signals with profit. If you are purchasing signals, you can use a copier that will copy these signals to your accounts on which you are using arbitrage trading. This is why the trade copier is a very important trading instrument as it allows you to copy signals from other traders and other sources. It also allows you to control multiple accounts at once. You can trade on some accounts and copy these orders on a larger amount of accounts.

Signals service providers

1. ZuluTrade
2. myfxbook

Hopefully, this article could outline some doubts that you may have had about trading, strategies, and our company. If you have any questions, please do not hesitate to write to us, as we will do our best to assist you. Happy trading!

In the latest version of VIP Crypto Arbitrage Software, we have added the ability to choose which price to use when detecting arbitrage situations. Previously, in the program, only TOB price (top of the book, best bid, and ask) was used. For FIX API and / trading, this approach is suitable enough, but for crypto exchanges, sometimes TOB orders contain small volumes, so the best bid and ask prices possibly not represent the final price at which arbitrage order will be executed. That is why we have implemented 2 buttons (for each side of the hedging pair), called “Price management ...”:

If you click on one of these buttons, a new dialog will appear:

By default, “Top Of the book” is selected. It means that in price comparison, the best bid and ask will be used on this side.

If  you select “Weighted average from x to y level,” the price will be calculated by the formula (https://www.investopedia.com/terms/v/vwap.asp):

where Price and Volume are price and volume on each level of the book.

If you select “Weighted average (for specified volume),” the price will be calculated by the same formula, iterating from zero level (TOB) and down, and stop once the calculated cumulative volume is higher than the volume specified in “Lots” field for this side.

Important note:  If you want to deal with non-TOB prices for WebSocket crypto connectors, you will need to specify and control Market depth parameter for Crypto Pricing:

This parameter controls how many levels will be kept in the symbols' order book when getting market data updates from the exchanges. The maximum supported value is 10. 

Learn more about VIP Crypto Arbitrage Software

The main advantage of this kind of trading is that you don't need to keep deposits on both coins to buy and sell, you will need to convert your deposit to USDT (usually) and use it as margin .

In the latest 8.4 version of VIP Crypto Arbitrgae Software you can find 4 exchange connectors allowing trading with perpetual futures/swaps: BINANCE_USDT_FUTURES, BYBIT_USDT_PERPERTUAL, HUOBI_SWAP, OKEX_SWAP. Please study each exchange requirements

Crypto Arbitrage Software Pricing Connectors 

Crypto Arbitrage Software Trading Connectors 

Good explanation on perpetual contracts.

What is a futures contract?

A futures contract is a kind of contract to either buy or sell an instrument for a certain price at a certain time in the future, think of it as agreeing to close a deal in the future,

If you have some experience in the market, you know that trades take a very short time to complete. In a futures market, this is not the case. The reason it is called a futures contract is that it is an agreement for the future, which allows the parties to trade in the future on a specific date. This market does not let you buy or sell the instrument, but it allows you to create an agreement to trade later on, as the contract is brought to fruition. As you may have already figured out, future prices may change as more time goes on, creating risks for the buyer and the seller, and the more time is spent before executing the contract, the higher the risk that both parties experience

Why users trade futures contracts?

Risk management and hedging are the reasons that people choose to trade these futures contracts. Even if a trader does not own an instrument, they can try their luck on it. The futures contract also provides traders with leverage, they can partake in trades larger than their account balance.

What is a perpetual futures contract?

This is a different type of futures contract, one that will never expire. A trader can hold their position indefinitely, but the trading of these contracts is all according to an Index Price, this price is given by the average price of an asset. Therefore, unlike a regular futures contract, the perpetual futures contracts are most likely going to be traded at a price identical to market price. The largest difference between these and a regular futures contract is the indefinite execution date.

What is the initial margin?

This is the smallest cost you need to pay in order to open a position with leverage, it backs up your position and acts as a security measure.

What is the maintenance margin?

This margin is the minimum amount of the security or collateral that you must be of ownership to in order to keep all of your positions open. If this is not met, your positions will either be liquidated or you will be asked to add more funds. If you are trading cryptocurrency, you will most likely be liquidated.

This system is different throughout various exchanges and markets, but usually, if the account has remaining funds after liquidation is executed, they will be given back to the user, but if there is less, the user is labeled as bankrupt. You are charged extra fees when you are liquidated, so closing your positions before you are liquidated, or adding more funds will eliminate that possibility.

What is the funding rate?

When a funding rate is positive, traders that have a long position open, pay the ones that have the short position open. The rate of these payments is calculated according to the interest rate and premium. When a perpetual futures contract is trading higher than the spot markets, long positions will have to pay short positions due to the positive rate.

What is the mark price?

This is an estimate of the actual value of the contract, or what the fair price is. This is compared to the price that it last traded at. If this price states that the price is unfair, some liquidations may happen depending on the volatility of the market.

What is PnL?

PnL stands for profit and loss, this could be realized or unrealized depending if the order is still open or closed. As you have probably already figured out, an unrealized PnL occurs before the order is closed, similarly to the realized, which occurs after and cannot change anymore. This is unrelated to the mark price, it is only related to the actual price that the order was completed at. Whilst this cannot change anymore, an unrealized PnL can keep changing until you close your position.

What is Auto-deleveraging?

This is the last step that occurs when the insurance fund mentioned earlier is unable to cover all of the traders’ bankrupt positions. This is a very unlikely situation, but this technique may require highly profitable traders to allocate their funds to those bankrupt.

Read more about Crypto Arbitrage Software

The first option is called Auto-Refresh. When selected, if the values of forecast for triggers are not stagnant and vary, the auto-refresh feature will update the value automatically.

For example, if the predicted value was 0.7, but changes to 0.8, it will automatically substitute 0.8 into the appropriate column. The program checks for changes every five minutes, so as seen here, the predicted value for Crude Oil was 0, and changed to 3.256 automatically without any manual additions.

The next option is the ability to save triggers. It is possible to save a trigger into the local database.

This means that if a trigger is selected and the option to “save trigger to local database” is picked, the next time the same news are released, let's say in a month, the trigger can be loaded from the local database.

Then you can add it to the list. As you can see, there is also a filter which allows you to sort through triggers by currency or name of indicator,  when more triggers accumulate. Likewise, you can remove a trigger from the local database if it serves no value to you anymore or perhaps to re-save it.

Furthermore, If you want to use this trigger you can select it and select the “Add to list” option. If the trigger already exists, the program will ask if youd like to overwrite or create a new trigger, or cancel the process altogether.

 If you click the no option, the trigger will add once again and you can utilise one trigger for one group, and another trigger for another group, respectively.

The next option is to load a trigger from a remote database. We will create triggers with certain parameters as we see fit for the future, and you can load these triggers from the remote database.

As you can see here, there is only one trigger so far in the remote database, however we will add more, and the same process as discussed before applies. Once you add it to the list, the options to add the same trigger, to overwrite the trigger, or cancel the process altogether will be available to the user.

Another option which was added was to manage the lot size by group, if you go to group , manage group, you will see the following additions : start lot, increase of lot size, and the decrease of lot size, based on the signal and this can be applied to the whole group.

For example if you would like to add changes to the group,  and you need for the program to trade with lot 0.1 with minimal signal, and for it to increase and decrease by 0.1, respectively, you can change these values here and click apply.

Now all of the triggers will be changed, and there is no need to change this manually in each trigger, the same thing can be done for the invariable triggers.

For a weak signal you can create 1 lot, for normal 2 lots and for strong signal you can select three lots, and select apply, after which the system will apply these values for each trigger.

You can also select the order type, for example if you select the FIX API group, select the Limit_FOK order type, and click apply. The same can be done for any other group.

There is another option which is reordering by day, if the triggers are not in order, you can reorder each trigger by the time on which they will act. For example these have already been triggered and this one has 5 hours and ten minutes left, so the program will order the triggers by increase in value of the time the triggers have acted, or will act.

Read more about NewsAutoTraderPro

A second category of brokers is the hybrid broker. As the name suggests, hybrid brokers use a combination of two business models: the STP/A-book model and the B-book model. Clients who make money are placed in the A-book (where orders are filled externally), while clients who lose money are kept in the B-book (where orders are filled internally by the broker). Keeping unprofitable traders in the B-book ensures that the broker derives revenue not only from commission fees, but also from deposits lost by traders in the B-book.

The third category is the B-book broker. B-book brokers do not use the interbank market at all. Although they may occasionally take advantage of copiers to hedge risks, they tend to introduce significant order execution delays and slippage to prevent traders from making money and the broker from losing it. B-book brokers trade against their clients. For a B-book broker, therefore, a trader with a successful strategy such as arbitrage or trading the news is a highly problematic kind of trader. If the trader makes money, the B-book broker incurs a loss. To protect itself, the broker resorts to using delays and slippage, which makes well-performing strategies all but ineffective.

It is the hybrid broker that interests us the most. This is for two reasons. First, it is the most common category of brokers. Second, hybrid brokers invest a considerable amount of money to ensure that their business models are efficient. As mentioned, with a hybrid broker, part of the client base remains in the B-book; the others are moved to the A-book. From the standpoint of an arbitrage trader, hybrid brokers make it possible to use arbitrage, potentially for long periods of time.

The hybrid broker can further be divided into two subtypes. The first subtype is brokers that initially place all traders in the A-book and monitor their performance, moving traders who lose money to the B-book. Not every unprofitable trader might be moved to the B-book, though; all sorts of rules can be applied by the broker to deal with unique situations. For example, if a trader has a large deposit and trades with sizeable lots, the broker might not want to be exposed to the risk that comes with moving the trader to the B-book - a single profitable order with 10 lots placed by such a trader can wipe out all the profits that the broker has earned from the trader’s previous losing trades. For that reason, a trader with large orders might remain in the A-book even if that trader is losing money.

The second subtype is the opposite of the first one. It is the broker that initially places all traders - or all accounts of a certain size - in the B-book and then watches their performance. Profitable traders or “toxic traders” (i.e., traders who are flagged as arbitrage traders by the broker’s system) are moved to the A-book.

Both of these subtypes deserve our attention. More often than not, you can trade successfully with such brokers if you use the right approach.

What is the right approach? In order to work with a hybrid broker, you first need two different accounts. If you want to use the same broker, you will need to ensure that your two accounts are under different names. If you want both accounts to be under one name, then you should use two different brokers.

Also, make sure that you keep your deposits modest in both accounts; the deposit should not exceed $5,000-6000. The broker will consider a deposit of this size to be a low-risk one and will try to switch it back and forth between the A-book and the B-book as required.

Next, you add both accounts to your lock arbitrage software and set a large difference-to-open value to prevent orders from being opened. Locks are then created in the same direction for pairs that enjoy a positive correlation - for example, the EUR/USD and CHF/USD pairs. Essentially, the locks are opened in the direction of the same currency. As the market is constantly fluctuating, sooner or later, one of the accounts will have lost money, while the other account will end up with a higher deposit.

A number of things need to be taken into consideration here. Keep in mind that “triple-swap” rollover takes place every Wednesday at 17:00 ET. To avoid losing money when rollover happens, locks should be opened on Monday; if nothing happens before Wednesday, it is best to close the locks and then reopen them after some time. It is also desirable to close and reopen locks from time to time to create some semblance of trading activity.

Once one of the accounts has lost, say, half of its value and the other is up some 45% (i.e., 50% less commission fees), you can close the locks. At that point, you can withdraw the funds from the profitable account; you no longer need that account. Your focus should now be on the unprofitable account.

Open an order in the unprofitable account and look at the order execution time. If the order execution time is about 50 milliseconds, you know you are in the B-book. That’s what you want. You can now use this account in conjunction with a latency, hedge, or lock arbitrage trading strategy.

We recommend that you avoid using VPSs that are frequently used by other traders. Using a less popular VPS will allow you to trade longer with the broker. If your account is in the B-book, you can use any ordinary VPS as long as it is located in the same data center as the broker. (Naturally, do not use a VPS in New York when you are using a broker with, say, servers in London.)

Be aware that some brokers also use order execution delays in the B-book. In other words, they create an A-book environment in the B-book. You won’t be able to use that kind of broker. Experience can be helpful when you need to weed out brokers that engage in this behavior.

You will need to continuously monitor order execution times in your account. For example, if you are using a latency arbitrage strategy, note the order execution time on your first couple of orders. This time should stay constant. The moment you see an increase, you will need to close the account and withdraw your funds, as you can be sure that the broker has caught on to what you have been doing.

However, bear in mind that not all hybrid brokers are alike. Some brokers use plugins that are guided by profitability levels. That is, if the profitability of your account reaches a certain percentage of your deposit, the account is moved to the A-book. Brokers that use such plugins are ideal because they allow you to trade for long periods of time. As long as you stay below the threshold in the plugin, you can use this account. If, on the other hand, the broker uses plugins that seek to detect arbitrage strategies, you will have a hard time working with that broker.

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As advances in technology continue to make trading more accessible to retail investors, and as the forex market becomes more competitive than ever, you need to have the right tools at your disposal. In this article, we will explain why expert advisors (EAs) are a great tool for any forex trader. You will also find out what you should consider before settling on an EA. Let’s start by defining EAs.

What are expert advisors?

In simple terms, an EA is a piece of software that either trades automatically or informs the trader when orders should be entered. EAs reduce human involvement in trading or remove it from the equation altogether, giving the trader a speed advantage. Like all computers, EAs are faster than humans. In an industry where speed and time are everything, this is crucial.

What EAs should you use?

This is the million-dollar question. The short answer is that it depends.

What is your trading strategy?

First and foremost, you should opt for the best EA for your particular trading strategy. If you’re a “plain-vanilla” trader, you’ll probably want an ordinary EA. We define plain-vanilla traders as normal traders. As a plain-vanilla trader, you probably want to open a trading account with a broker and stay with that broker for as long as possible. While this is a legitimate approach to trading, we do not usually recommend it.

Why? Well, first, profits are going to be modest. Second, risk levels will be high: simply put, it is very difficult to earn high profits by being a plain-vanilla trader, even if you’re using a scalping trading strategy. Third, if you do become too successful for your broker’s liking, the broker might start making life a bit difficult for you (for example, by ratcheting up your slippage levels) to put you out of business.

For that reason, we recommend that traders adopt either arbitrage trading or trading the news as their strategies. These are more sophisticated trading strategies that typically offer greater profits and lower risk.

Is arbitrage trading for you?

There are two forms of arbitrage trading: latency arbitrage and lock arbitrage. Broadly speaking, we prefer lock arbitrage over latency arbitrage. Lock arbitrage disguises your trading strategy; your trades look like manual trades. Not all brokers like arbitrage strategies or traders who use them. Although the use of arbitrage is perfectly legal, some brokers balk at arbitrage traders because they threaten their profits. Typically, this is because the broker is using the B-book model, where the broker is effectively trading against clients. If a client starts making money, the broker loses it. Consequently, such brokers keep an eye on unusually profitable accounts and pull the plug on the account if arbitrage trading activity is detected. While brokers have the right to do that, bear in mind that the trader is not doing anything illegal in this situation. Brokers that insist they don’t want you to use arbitrage strategies are almost always brokers that don’t want you to make money.

If you still need to deal with such brokers, lock arbitrage will help you. As mentioned earlier, lock arbitrage makes your trading look like manual trading. Your orders are not closed as quickly as they are with latency arbitrage software, and they are opened before an arbitrage situation arises and closed when the arbitrage situation is underway. Lock arbitrage is a high-profit, low-risk kind of arbitrage trading (to put it into numbers, monthly returns between 50% and 100% are not uncommon, and the risk is virtually zero).

However, keep in mind that if you get too profitable (for example, if you have monthly profits in the triple digits), the broker might put an end to your trading even when you’re using lock arbitrage. Still, you will at least get all of your money (deposit and profits) back - provided that you used our lock arbitrage software and everything was set up correctly. The broker won’t be able to find any evidence of an arbitrage trading strategy having been used, and your case will be watertight.

We are less enthusiastic about latency arbitrage, largely because it is easier for brokers to identify a latency arbitrage strategy as arbitrage. However, it is still a viable option for certain traders, primarily for those traders who seek to make a quick buck - the nature of latency arbitrage makes this easier. As long as the risk of detection is accounted for, latency arbitrage could work for some traders. 

So, is arbitrage trading for you? Well, do you like to trade daily? Are you happy with small profits on each trade? If the answer is “yes” to both questions, then you might find arbitrage trading interesting. If not, you might want to explore trading the news.

Is trading the news for you?

As the name suggests, trading the news is a strategy that seeks to profit from price changes and market moves caused by news releases. This trading technique is more appropriate for traders who are not interested in a lot of action. News traders usually have a handful of trades every week, often no more than 10. On the other hand, they use large lot sizes when they do trade to make up for the infrequency of their trading. Consequently, per-trade profits can be quite substantial (a 100% profit on a single trade is not unrealistic). If you are a “trading junkie”, trading the news is not for you. It’s a matter of temperament. If you are interested in trading the news, we offer software that will help you trade the news efficiently. We will also provide you with our recommended triggers.

You know yourself better than anyone else. Pick the trading strategy that you’re most comfortable with. However, we must reiterate that arbitrage trading strategies and news-trading strategies are more profitable and less risky than plain-vanilla trading. Even when plain-vanilla traders use scalping or money management trading strategies, their risk increases, as their stop losses need to be set at a greater distance from prices.

Now that we have briefly covered trading strategies, let’s go back to the main question.

What EA is best for you?

As with trading strategies, there is no one-size-fits-all answer. There are a number of considerations that should guide you.

• Capital - how much money are you willing to deposit in your trading account? What works for someone with several hundred dollars won’t work for someone with $1 million.
• Time - are you interested in short-term profits or long-term profits? As with the capital consideration, how you answer this question will influence the EA recommendation that we’ll make.
• Location, location, location - some countries are just better than others for trading. For example, the USA has become restrictive in regulatory terms, and some accounts are off-limits to American traders. In this case, an ordinary robot might be a better idea. This will likely also apply to you if you’re in a country that is facing sanctions or has been blacklisted.

What do we recommend?

Most important, we recommend that you determine what it is that you’d like to get out of your trading.

Determine the kind of trader that you are and which trading strategy works best, given your temperament. As has been mentioned, we recommend that you use arbitrage trading strategies (ideally, lock arbitrage) or that you trade the news, instead of gravitating towards plain-vanilla trading.

Be realistic about your profits. Remember that very high profits (in the triple digits) are unrealistic, certainly on a regular basis. Wildly high profits that are continuous are a major red flag for the broker, and your account might be shut down. If the broker is unregulated, you have a good chance of losing your profits entirely (unregulated brokers usually return the deposit in this situation, but not the profits).

When asking us for guidance, be clear on how much trading capital you have. As mentioned earlier, your capital will determine the kind of EA that we’ll recommend. You should also be clear on whether you’re a short-term or a long-term trader. Remember that your location is key to the kind of EA that you’ll need.

Where do we come in?

We offer a variety of cutting-edge expert advisors for different trading strategies and different kinds of traders. We can certainly help you choose the EA that is best for you, but you need to be very clear on what you want to achieve.

Trading the news is a strategy that involves trading based on news announcements. Certain financial and economic news items can, and do, move the prices of financial assets. Broadly speaking, a news trader seeks to anticipate these moves and profit from them.

What is trading the news like a professional?

There are many ways in which news traders can trade the news. One of them is by subscribing to a news feed. There are a few news providers that offer a news feed service: Bloomberg, Reuters, Haawks, Alphaflash... The providers have reporters posted at selected news sources that are responsible for releasing economic and financial data. When the sources release news, the reporters promptly input the released data into their machines. The data is sent to a central server, and the server sends the information through its fast feed to the company’s subscribers.

What tools does a professional news trader need?

As mentioned earlier, a professional news trader needs to be subscribed to a fast feed. The trader will also need a software product designed for trading the news. The purpose of such a product is to compare forecast numbers with actual ones, and to trade based on these comparisons. This sort of trading involves the use of triggers (more on triggers later).

Read more about NewsAutoTraderPro

Why do forecasts matter?

There is an army of professionals whose job it is to watch economic developments and indicators, and make predictions about their future performance. For example, economists will typically try to anticipate the numbers for the inflation rate and unemployment data in the US or elsewhere. These forecasts are widely reported and can be viewed by the public. When the actual numbers are released, the prices of certain financial assets can move if there’s a difference between the forecast and the actual figure. The higher the difference, the more dramatic the price swing. When economists tend to agree on their forecasts, they are said to have a consensus.

A professional news trader attempts to profit from any price swings ensuing from differences between forecasts and actual numbers. When there’s an established consensus, it is easier - and, therefore, less risky - for news traders to predict the reaction of the market if there is a difference between the consensus and the results. When economists differ in their forecasts and no consensus has been established, trading the news becomes riskier, since the reaction of the market to any possible differences is harder to anticipate. A news trader would want to use a higher deviation when setting a trigger in this situation.

What are triggers?

A trigger is simply the parameters used by a news trader to enter the most desirable order when there is a difference between forecast and actual values. For example, if the actual inflation rate in the US is higher than the one predicted by economists, the trigger will involve a buy order for the US dollar. When a trigger is set, the news trader also specifies the stop-loss, take-profit, and trailing-stop parameters.

A trigger can also protect the trader against delays if the software product used by the trader allows that. This is very useful when a news item is disseminated too early by some news provider, or when there is a sharp price swing before a news item is released. In either situation, the trigger will prevent orders from being entered. The trader will then avoid exposure to unnecessary risks.

Additionally, triggers help the trader control risk by using different lot sizes. Provided that the software offers the necessary functionality, the trader might set the trigger so that lot sizes are increased as the difference between forecast and actual values increases. For example, the trader might set the trigger to trade with a lot size of 1 when the difference is 0.1%, or a lot size of 2 when the difference is 0.2%.

What else should professional news traders know?

A professional news trader should have a solid understanding of current economic conditions. This involves monitoring and analyzing political and economic news. Tensions in the Middle East or indications of a major economic recession in China, for example, can cause significant price moves. The US dollar, the euro, oil, gold, and other financial assets might experience dramatic price swings in response to good or bad news. Successful news trading hinges on the trader’s ability to understand the current economic situation and the ways in which future changes in this situation will impact the financial assets the trader wants to trade. This understanding should inform the triggers set by the trader.

It is also important for professional news traders to trade the most volatile assets. Bear in mind that market developments cause volatility to change over time for various assets. When investors are anxious, they buy gold, causing gold price volatility to rise. When times are calm, gold becomes less volatile. News traders are advised to pick assets that offer more volatility, not less.

What should professional news traders avoid?

A professional news trader should avoid trading a currency pair when the market expects simultaneous major news announcements that will affect both currencies in the pair. A major news announcement is one that can have a significant impact on the price of the currency. If two major news releases are imminent in the US and in Japan, for example, avoid trading the USD/JPY pair. It might be better to trade the EUR/USD pair instead, or some other asset.

Where do we come in?

We offer professional news traders a cutting-edge software product that is perfect for their needs. This software sends news data through a fast feed and compares the data to forecasts. The software then enters orders to profit from any differences, employing stop losses, take profits, and trailing stops in automatic mode. The product also sets triggers for the trader. The work is done by our company; the trader need only download the triggers every Sunday and indicate the desired lot sizes.

Read more about NewsAutoTraderPro

We added 3 new important options for our NewsAutoTraderPro software version 1.19.

Option 1 –“Max Delay”, ms (pic. 1, point 1)

This option helps you to avoid trading on news which was delivered from news feed provider with delay.

For example:
News time 8.30am
“Max Delay” = 3000
Software will not consider news if it will be delivered after 8.30.03 am (8.30 + 3000ms (3sec)) 

Important: To properly use this option, please be sure that you use time sync software on your VPS like https://www.meinbergglobal.com/english/sw/ntp.htm#ntp_stable

Option 2 – “Max jump” (pic. 1, point 2) -

This option allows you to prevent trading if price already reacted on news. You need to set 2 parameters:
“Interval”, sec. - software will collect ticks for this interval and calculate average price.
“Max jump”, points - software will prevent trading, if price higher (for buy signal) or lower (for sell signal) then average price before news release in points on "Max jump".

For example:

if we set: Interval = 10 sec and software calculate average price for this interval = 1.35105 and we set Max jump =30 points and when news arrived price > 1.35135 for buy signal or price < 1.35075 for sell signal, this signal will be not take into account.

Option 3 – Spread S/L (pic. 1, point 3)

This option allows you to set stop loss value based on current spread. This will protect your account from triggering a close stop loss (S/L) because the broker has expanded spread during the news release. To activate this option, you need to tick “Spread S/L” and set “Factor”. Stop Loss will be calculated by formula: Current spread x Factor.

For example:
if current spread = 20 points and Factor was set = 1.5 Stop Los will be triggered on 30 points from current spread.
If for some reason, software will be unable to please stop los based on this calculation, software will place Stop Loss order specified in Stop Loss filed (Pic 1, Point 4)

We also added possibility to check if forecast was changed from time when we created triggers (Sunday). 

When you reload calendar (press "Apply" button), and forecast value has been changed for trigger, you will be informed and will be able to change the value
-

NewsAutoTraderPro- Close Lock Strategy

CloseLock strategy is fully implemented. 

First at all, you need to select accounts for lock. You can add 2 accounts to lock only if they are in the same group. Please view following video how to merge two accounts in lock.Next step- you need adjust lock parameters for each trigger. 

1. Please select Strategy -> Close Lock

2. Please select "Open Lock" time (minutes). - Software will open lock for the specified time before news event. 

3. Please select "Close lock" time (minutes). - Software will close lock after the specified time after news event. 

Example:

We added account 1 (Side 1)  and account 2 (side 2) into lock. 

Open Lock = 10 min

Close lock = 15 min

Lock lots= 0.01

For 10 min before news release software will open Buy 0.01 on Side 1, Account 1 and sell 0.01 on Side 2, Account 2. If trigger will be activated and we get Buy signal, software will close Sell on Side, Account 2 and apply Stop Loss, Take Profit, trailing Stop and all trigger rules for Side 1, Account 1. Buy order on Account 1 will be closed by triger rules. 

If trigger was not activated - software will close lock after 15 min after news release.

NewsAutoTraderPro- Open Lock Strategy

Open lock strategy is opposite strategy for close lock strategy.

1. Please select Strategy -> Open Lock

2. Please select "Close lock" time (minutes). - Software will close lock after the specified time after news event.

Example:

We added Account 1 (Side 1)  and Account 2 (Side 2) into lock. 

Close lock = 15 min

Lock lots= 0.01

Software will open buy order if trigger will be activated and we get buy signal on Side 1 (Account 1) and apply all triggers rules for this order. When buy order should be closed according to trigger rules, software will lock this another instead to close it: open sell order on Side 2 (Account 2) and vice versa. Software will close lock after after 15 min after news release. 

Open Lock Strategy vs Close Lock Strategy

Open Lock Forex news trading strategy 

has the following advantage: if trigger was not activated, software will not open order and we will not spent money for commissions.

Disadvantage: we open order on news release in the same direction with market movement.

Close Lock Forex news trading strategy 

has the following advantage: we open orders for certain time before news release and close opposite to signal  order on news release.

Disadvantage: we pay commissions even if the trigger was not activated.

Read more about NewsAutoTraderPro Software

If you trade on the exchange, then you may have difficulty in closing the order. This problem arises for the reason that Binance charges a commission from amount which you are buying .

You bought 50BAT but found 49.95BAT in your margin wallet is because you paid 0.05BAT as a trading fee. Now, you have 49.95BAT in your wallet, if you try to sell 50BAT, you will get the 'insufficient balance' error.

You don't need to buy extra 1 BAT to sell BAT back to BTC, you can just sell 49BAT and transfer leftover 0.95BAT to your spot account, after that you can  convert dust asset to BNB. (Please refer this link  to get more details). How to get around this problem. You just need to add small balance to each altcoin which you want to trade.

How to trade Altcoins on Binance (Latency Crypto Arbitrage)

If you trade BAT you can add 1 BAT to BAT wallet and when bought 50BAT but found 49.95BAT +1 BAT which you deposit before.. Now, you have 50.95BAT in your wallet, and you can sell 50 BAT.

If you decided do not trade this altcoin anymore and you still have leftover. You transfer leftover 0.95BAT to your spot account, after that you can  convert dust asset to BNB.

This situation can be easier to solve when Binance margin trading will be available for trading via API.

Binance Margin Trading

Margin trading is in the spot market, which means you need to have sufficient balance before trading. In our case, you want to buy and sell BATBTC, you need to have BAT or BTC in your margin account. You can trade BATBTC without sufficient balance in your margin account is because you may using borrow feature when you trade.

At this stage, API doesn't have this feature yet, but it is under development, once it is in public view version, you can find it in the change log.

Read more about VIP Crypto Arbitrage Software

CryptoArbitrage bot for latency crypto arbitrage

Today I would like to explain the way of crypto arbitrage on 1 exchange only and how to adjust crypto arbitrage bot for  latency crypto arbitrage or 1 leg crypto arbitrage trading method. This method more acceptable than a hedge crypto arbitrage for cryptocurrencies traders with small capitals for several reasons:
1. With small deposits your commission will be higher and with a hedge crypto arbitrage it will be more difficult to achieve difference between cryptocurrencies to cover commissions + spreads;
2. For hedge crypto arbitrage you need to keep a deposit of several crypto currencies.
For these and other reasons a lot of crypto traders prefer latency crypto arbitrage.

How to make proper setup for latency crypto arbitrage.

First of all you need to find exchange with faster quotes for crypto currencies. Usually faster exchanges with large trading volume and for now you can use Huobi. You do not need to open account with them because it is not necessary to have account to receive quotes.  
 For trading you can use exchange which allows to trade a lot of altcoins.  

In order to understand which altcoins on your exchange are suitable for trading, you need to follow several rules:
1.    Altcoin should be actively trading – price should change frequently, and arbitrage situations arise;
2.    Price difference between fast feed (Huobi in our example) and your crypto crypto exchange should not hold long enough to be able to complete a deal;
3.    The trading volume of the investigated altcoin should be high enough to exclude altcoins whose popularity is promoted by special crypto bots.
To find altcoins, run VIP Crypto arbitrage software in emulation mode add all possible altcoins with bitcoin (BTC) based crypto currency and check for 1 week.
For live trading leave only altcoins satisfying the above conditions.

How to setup VIP Crypto Arbitrage software

Read more about VIP Crypto Arbitrage Software
 

To make proper setup you need to:
1.     Select “allow buy” on exchange for trading and “allow sell” for fast feed exchange. In this case you can have deposit only in one currency – bitcoin (BTC);
2.    Select “Virtual” for fast feed exchange;
3.    Select “Check Quantity” – check if there enough liquidity in TOB Top of the book to fill an order with the specified lot size, if not arbitrage situation will be ignored;
4.    Click “Order management” and adjust trailing stop
Order management -  calls trailing parameters management window for  the selected side. Trailing options window will appear only when editing existing hedging pair, you can't adjust these parameters when adding a new hedging pair.


 

5.    We recommend “Profit mode” –> currency and Diff input -> percents
Difference to open can be around 2% , but difference to close should be high ( you  can set 20%)

This method was successfully tested by us and our clients and I hope this article will help you to be successful crypto arbitrage trader as well.

None of this is meant to be discouraging. You have to be an astute trader to make money on any financial market. Being an astute trader means you need to be aware of all the risks and your trading strategy should factor in all possible limitations. The cryptocurrency market is a burgeoning, dynamic place that continues to offer opportunities to intelligent arbitrage traders who come to the market prepared.

Read more about VIP Crypto Arbitrage Software

Question 1 "Is it possible to make a living from Forex trading?" - Answers

Question 2 "When you started trading Forex?" - Answers

Question 3 "Are you making money trading Forex?" -Answers

Question 4 "Which one Forex trading strategy do you think is the best?" - Answers

There are only a few viable strategies that work on the forex market, and it is best to focus on them. The three strategies I recommend are arbitrage, scalping, and trading the news. Unlike other strategies - which require higher deposits, not least because you’ll need to wait out drawdowns - these strategies (and their variations) offer higher profits and less risk. It is therefore advisable to stick to them.

Aside from the question about whether it’s possible to live off forex trading, here is another frequently asked question: “I have $1,000. How much money do I need, and how much can I expect to make if I buy your EA?”

A lot of our clients look puzzled when I recommend aiming at monthly profits of 30-40%. They have seen online statements that showed fabulous daily profits of as much as 500%, and my profit targets look underwhelming by comparison, to say the least. It is important to be realistic. If you rake in exceptionally high profits on a daily basis, your broker will quickly close your account. In fact, you’ll be lucky if the broker agrees to turn over the profits after your account is shut down. Even if you do manage to recover your profits, it is evidently not a workable long-term strategy. You won’t be able to make a living from forex trading that way. This strategy is only possible if you’re interested in one-time profits.
If one-time profits are your goal, you might want to try VIP Latency Arbitrage, which is the best software product when it comes to short-term profits.

While I am not a big fan of one-time profits, here’s some advice that I would offer to those who are interested in this type of trading. After testing your strategy, choose 1-3 pairs that are best for arbitrage purposes. Test your broker’s support team - as a (probably) young company, your brokerage firm will be unlikely to offer 24/7 support, so you’ll need to know when support is offline in order to do your testing. Make sure you apply aggressive money management (increase the lot size you trade based on the account size) and start opening your orders. If it worked, you now need to take your profits off the table. If you’re able to pocket your profits without any hassles, great! But don’t count on being able to replicate this kind of success.
Let’s go back to the trading strategies that I consider to be viable in the long term. In order to determine whether you can make a living from trading on the forex market, you will need to figure out how much you have to allocate to expenses associated with getting started and how much should be allocated to your initial deposit. Once you have those amounts, see if a monthly profit of 20% is sufficient for your needs (this is a realistic number that takes into account periods of low market volatility, periodic changes in the brokerage company you use, and oscillating profits - in some months, a profit of 100% can be made, while in others your return might be zero). If a 20% return is sufficient, then the question about your ability to live off forex trading can be answered in the affirmative: yes, it is definitely possible.

That said, it is best to focus more on the trading process than on potential profits. This is the only way to accomplish your goals, obtain a stable income stream, and turn forex trading into your day job.
As we sell a wide range of products, many of our clients want to know which product is best for them. When I receive this question, I usually ask for additional clarification. One client’s needs are bound to be different from the needs of another client, so there are two things that I need to know in order to recommend a product that is ideal for you:
1.    Your country of residence.
2.    The size of your investment deposit (i.e., how much are you prepared to invest?).

The first question is easy enough to answer, but I find that many of our clients struggle with the second one, and we often get responses that leave us scratching our heads. The client would respond by saying that there is some $200 available to invest and that, if things work out, the deposit would be increased to $100,000. Actually, this invites even more questions. If you have $100,000 to invest, then VIP Multi-leg Arbitrage is your best bet. But . . . if you buy that software product and open two accounts with brokers, there is a good chance that you won’t be successful. In order to make the software work for you, you will need to open one FIX API account with LMAX, investing at least $10,000, and a second FIX API account with a similar deposit (or, alternatively, an account with a minimum deposit of $2,000).

If you have $200 to invest, on the other hand, you will need a very different software product. VIP Lock Arbitrage for should be very useful for traders with more modest deposits. However, were you to try this product with $100,000, you would quickly hit a wall. The broker would see a red flag, and your brief streak of success might come to a premature end. This is why we ask clients to be precise when it comes to providing information about their deposits, and to follow our product recommendations once these are made.

Another problem that we often encounter among our clients is excessive trust in brokers. Traders want to work with brokers without any problems, so they decide to be absolutely transparent with respect to their intentions. Even experienced traders sometimes disclose to their brokers information that should probably be withheld. Some traders have friends who are employees at brokerage firms, and the traders think that the relationship will help them come up with an arrangement that is suitable for both parties. When mouthwatering monthly profits on the order of 1,000% are mentioned, these friends-cum-employees become especially willing to help the traders with their arbitrage strategy.
It is a mistake to be that trusting.

It is a mistake to be that trusting even if your broker is a true ECN broker. In fact, a “true ECN” broker is something of a misnomer - it is more appropriate to call such brokers “STP brokers”. An STP broker connects you directly to the liquidity provider and does not interfere with your trading; it is merely the intermediary between you and the liquidity provider. The liquidity provider used by the broker might actually use another liquidity provider, which in turn might have its own liquidity provider, etc. This chain can be quite long, and there’s a good chance that one of these liquidity providers will be left unimpressed by your arbitrage trading. Your broker might get a call with a request to rein in the toxic flow sent by you. Alternatively, the liquidity provider might switch you to a special feed that has a lot of slippage and makes arbitrage trading all but impossible.

The upshot is that it’s inadvisable to tell your broker anything about your trading strategy. It does not, and should not, concern your broker. You can use any trading strategy you want on the forex market - it is perfectly legal.
There are really only three ways to keep the broker at bay when using arbitrage trading.

1.    Do not mention you’re using Lock Latency Arbitrage software or Multi-leg (hedge) Arbitrage software. The use of these products should make it possible for you to use arbitrage for long periods of time. This is because locking or hedging your positions helps increase the size of your profit on each trade and, most important, increase the duration of your open orders.
2.    Work at the Prime of Prime (PoP) level. Note that PoP requires you to have at least several million dollars in capital.
3.    Start your own brokerage firm. Your clients will provide non-toxic trading volume that you can use to mask your own toxic volume (the total non-toxic trading volume sent to the liquidity providers will be too large for your own toxic component to be noticeable). Additionally, liquidity providers will be more open to discussing the use of arbitrage trading with you if you’re a broker.

However, it is reasonable to assume that it’s best to start with the first solution before considering the next two.

Please, answer 4 questions  and we will add 45 point( $45) to your account  for your future purchase.

Any arbitrage trading can be divided into two categories:

• Dimensional arbitrage trading - when trading operations are conducted at different trading floors / crypto exchanges, but at the same time;
• Provisional arbitrage trading - operations are carried out on the same trading platform / crypto exchange, but at different times.

Hedge Crypto Arbitrage

Dimensional arbitrage trading is most popular method for crypto arbitrage. The price for the same instrument (cryptocurrency) can be different for different crypto exchanges and arbitrage  software compares prices between the two exchanges/brokers and after the arbitrage difference detected (open difference) software opens 2 opposite orders, buy and sell (buy on the exchange/broker with lower price, sell on the exchange/broker with the higher price), at the same time.

Once the opposite price difference (close difference) detected (price on the broker/exchange with the sell order is now lower that on the exchange/broker with the buy order) software closes both orders etc. VIP Multileg Crypto Arbitrage Software is already integrated with: GDAX, Kraken, Bitfinex, Bitstamp, Bitmex, Binance, Poloniex, Bittrex, Deribit, Okex, Cexio, Huobi, Hitbtc, EXMO, SFOX crypto exchanges.

For example
Price on SFOX on ETH = 290 USD
Price on Binance on ETH = 310 USD
Step 1

VIP Multi-Leg Crypto – Arbitrage software will sell ETH for USD on Binance and buy USD for ETH on SFOX
Waiting…..
Price on SFOX on ETH = 325 USD
Price on Binance on ETH = 310 USD

Step 2
VIP Multi-Leg Crypto – Arbitrage software will buy ETH for USD on Binance and sell USD for ETH on SFOX
If our lot size = 1 we will receive profit:
(310-290) +(325-310) = 35 usd

Ideally, everything looks great, but in practice the profit will be much less, since any cryptocurrency exchange charges a certain commission from the operations of the trader. Our Crypto Arbitrage Software allows you to set commissions for each exchange and in this case,  software will take them into account.

Commission 1(%) – commission per trade charged by broker/exchange on side 1 to be included in arb deal result calculation. Commission 2(%) – commission per trade charged by broker/exchange on side 2 to be included in arb deal result calculation. Commissions can be set in points or percents, depending on selected profit mode.
Points – difference will be calculated in points Currency – difference will be calculated in currency Percents – difference will be calculated in percents

When we created this software 2 years ago, highest volatility observed for bitcoin and bitcoin arbitrage could be called with confidence as most popular bitcoin trading strategies. If compare bitcoin arbitrage with any other bitcoin robot (bitcoin bot), then of course biсoin arbitrage was the most profitable and less risky. Today we would recommend to arbitrage ETH, XRP, and altcoins.

Latency Crypto Arbitrage

This method based on idea that one crypto exchange is always faster them another one. For example we know that price on SFOX updates faster then on Binance. In this case we can check “Virtual” box for side with SFOX exchange.
Virtual – open virtual order instead of real one on the selected side. Allows to use the software in 1-leg mode. [Important!!! Open and close methods should be set as open both/close both for this option to work properly.]

For example

Price on SFOX on ETH = 290 USD
Price on Binance on ETH = 310 USD

Step 1
VIP Multi-Leg Crypto – Arbitrage software will sell ETH for USD on Binance only
Waiting…..
Price on SFOX on ETH = 290 USD
Price on Binance on ETH = 290 USD

Step 2
VIP Multi-Leg Crypto – Arbitrage software will buy ETH for USD on Binance  only
If our lot size = 1 we will receive profit:
(310-290)  = 20 usd

If your license is activated not only Crypto trading, but  for FX trading as well, you can compare prices for crypro currencies between FX brokers who provide feed for crypto currencies as well with crypto exchanges. For example you can trade Crypto CFDs: BTCUSD, ETHUSD, LTCUSD, XRPUSD, BTHUSD with LMAX via FIX API. Live prices

Sometimes opportunities for arbitrage arise within the trading platform / crypto exchange itself. For example, with the difference of quotes of several cryptocurrencies. This arbitration scheme is called a triangular crypto arbitrage.

We have created triangular crypto arbitrage bot for our shareware Crypto platform 1stCryptoTrader. Please learn more: https://ico.1ct.io

>>>Click to Join Us!<<<

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A brief overview of arbitrage trading is in order. Broadly speaking, arbitrage trading involves exploiting price differences that tend to arise from market-related inefficiencies. For example, the same instrument (e.g., Bitcoin) can be offered at different prices on two different exchanges.

Seeing this difference, an arbitrage trader could buy a certain number of Bitcoins on the exchange with the lower price and sell it on the exchange with the higher price. The difference will be the trader’s profit.

These differences tend to happen in a decentralized environment in which there is relatively poor feedback and communication between different exchanges. In that respect, the cryptocurrency market offers an ideal environment for arbitrage trading.

However, while this kind of trading looks good on paper, arbitrage traders face a number of issues that are particular to the cryptocurrency market. As these issues might threaten arbitrage profits, you will need to take them into account if you want to apply arbitrage trading strategies to cryptocurrencies.

1. Commission fees. There are all sorts of commission fees associated with trading cryptocurrencies: buying/selling fees, transfer fees, deposit fees, withdrawal fees, etc. You need to factor all the commission fees that you can be expected to pay into your calculations. Your targeted spread should be large enough to leave you with a profit once the commission fees have been deducted.

2. Lags arising from time-related differences. It takes time to transfer cryptocurrencies between exchanges. To take advantage of a price difference between two cryptocurrency exchanges, for example, you will need to buy the cryptocurrency on one exchange and then move it to the exchange with the higher price in order to sell it. This process takes time, and many things can happen during that period. The longer it takes you to transfer the asset, the more room there is for the market to turn against you. That is, by the time the asset is moved to the other exchange, the price difference might have been corrected. The arbitrage opportunity will have been lost in this case. Additionally, there might be certain unscheduled technical upgrades on one of the platforms, which will increase the transfer time.

One way to address time-related differences is by having funds on several exchanges at the same time. That way, you’ll never need to physically transfer cryptocurrencies from one exchange to another. While this is a workable approach, there are drawbacks. It is inefficient to keep the same assets on multiple exchanges, and the approach requires extensive financial resources – not every trader has those. Additionally, you’ll still need to pay commission fees. You will also have less room for maneuvering, since you are effectively confined to a limited number of exchanges.

3. Liquidity issues. If you want to engage in arbitrage trading, expect competition. As more arbitrage traders continue to move in, the number of price differences will decrease and arbitrage profits will shrink. While certain cryptocurrencies such as Altcoins may still offer attractive price differences that can be exploited, these assets are far less liquid. Illiquid securities are harder to trade, and any advantage that you might have in terms of price can be easily lost as a result of poor liquidity.

4. “Intra-exchange” delays. There is another tactic that can be used to address the problems mentioned above: you can aim to exploit price differences between cryptocurrencies on the same exchange. This typically involves the use of three or more assets (e.g., two cryptocurrencies along with, say, the US dollar). However, the higher number of assets associated with the use of this approach means there is a greater risk of adverse price changes/movements during the time that you need to do the arbitrage trade. Also, bear in mind that some cryptocurrency exchanges create delays that will hinder arbitrage trading.

As you can see, there are all sorts of nuances that should not be overlooked. You shouldn’t let them stop you, though. The cryptocurrency market is still very much in its growing phase, and for the astute arbitrage trader the opportunities are there. A judicious application of your trading strategy – one in which you take into account the limitations and costs of arbitrage trading on the cryptocurrency market, as outlined briefly in this article – should help you stay ahead of other arbitrage traders and, hopefully, trade profitably.

Introduction

Lock arbitrage, a sophisticated financial strategy, has gained traction in the volatile world of foreign exchange (Forex) trading. This article delves into the intricate workings of lock arbitrage, shedding light on its mechanisms, benefits, risks, and the pivotal role it plays in the Forex market.

Understanding Lock Arbitrage

Lock arbitrage, often called "locked pairs trading," involves capitalizing on price discrepancies between two or more markets or brokers. In Forex, this means exploiting the differences in currency pair prices offered by different brokers.

Lock Arbitrage - The Mechanism

The core of lock arbitrage lies in the simultaneous buying and selling of a currency pair with two different brokers or the same broker but with two different accounts opened under two different names. BJF Trading Group developed several Lock arbitrage algorithms: lock arbitrage, lockCL1, LockCL2, LockCL3, BrightDuo and BrightTrio. This algorithm allows traders to use lock technology in different situations. For example, LockCL1 is more suitable for FIX API accounts because there is no situation when the software locks the same pair on one side. 

SharpTrader Arbitrage software allows you to use all Lock Arbitrage built-in strategies and other arbitrage strategies like Statistical, Hedge, triangular...

Implementation Tools

Lock arbitrage heavily relies on:

High-Speed Trading Software: Capable of real-time analysis and rapid execution.
Reliable Data Feeds: Access to ultra-fast price feeds is crucial for identifying discrepancies.

Benefits

1. Risk Reduction: By not holding opposing positions open for long, it minimizes exposure to market movements.
2. Efficiency in Stable Markets: This strategy can be profitable even in less volatile markets.

Risks and Considerations

1. Broker Policies: Some Forex brokers frown upon or forbid arbitrage, potentially leading to account penalties.
2. Dependence on Speed: Delays in execution can turn potential profits into losses.
3. Technical Glitches: The strategy's success hinges on the flawless operation of trading software and data feeds.

Ethical and Regulatory Landscape

Lock arbitrage operates in a complex ethical and regulatory environment. While not explicitly illegal, its practice can raise questions about market integrity and fairness.

Latency Arbitrage Software Example of code on Phyton

Latency arbitrage is a complex strategy that exploits price differences of the same asset on different markets due to the lag in the dissemination of price information. It's mostly used by high-frequency traders using sophisticated technology and infrastructure to gain an advantage over slower participants.

The logic of a latency arbitrage strategy in Python can be outlined, but implementing a functional latency arbitrage system would require real-time data feeds, execution capabilities, and the infrastructure to support high-speed trading, which cannot be fully illustrated here.

Here is a conceptual example of what the code could look like:

import time
import threading
from broker_api import BrokerAPI  # This is a placeholder for your broker's API

class LatencyArbitrageBot:
    def __init__(self, symbols, brokers):
        self.symbols = symbols
        self.brokers = brokers
        self.price_difference_threshold = 0.01  # The minimum price difference to trigger a trade

    def get_prices(self, broker, symbol):
        # Implement the function to get the latest prices from a broker
        # This would involve calling the broker's API
        return broker.get_price(symbol)

    def execute_trade(self, buy_broker, sell_broker, symbol, volume):
        # Implement the trade execution logic
        # This would involve calling the broker's API to place buy and sell orders simultaneously
        buy_broker.execute_trade(symbol, 'buy', volume)
        sell_broker.execute_trade(symbol, 'sell', volume)

    def find_arbitrage_opportunity(self):
        while True:
            for symbol in self.symbols:
                prices = [self.get_prices(broker, symbol) for broker in self.brokers]

                # Check if the price difference between brokers exceeds our threshold
                max_price = max(prices)
                min_price = min(prices)
                if max_price - min_price > self.price_difference_threshold:
                    buy_broker = self.brokers[prices.index(min_price)]
                    sell_broker = self.brokers[prices.index(max_price)]

                    # Execute trades if an arbitrage opportunity is found
                    self.execute_trade(buy_broker, sell_broker, symbol, volume=100)

            time.sleep(0.1)  # Sleep to avoid hitting API rate limits

if __name__ == '__main__':
    symbols = ['EURUSD', 'GBPUSD']
    brokers = [BrokerAPI('Broker1'), BrokerAPI('Broker2')]  # Replace with actual broker API objects
    arb_bot = LatencyArbitrageBot(symbols, brokers)
    arb_bot.find_arbitrage_opportunity()

Please note the following:

BrokerAPI is a placeholder for the actual API provided by your broker, which you would need to implement based on their documentation.
Real-world trading would need more sophisticated error handling, trading logic, and execution safeguards.

The example provided is highly simplified and would not be profitable in a real-world setting due to market slippage, transaction costs, and the sophisticated competition in the field of arbitrage.

There could be legal and ethical considerations when implementing such strategies, and it is essential to understand the regulatory environment of the markets in which you operate.
Finally, latency arbitrage is typically only profitable for those with the fastest data feeds and order execution capabilities, usually out of reach for retail traders.

Strategies for Camouflaging Lock Arbitrage in Forex Trading: A Closer Look

Introduction

Camouflaging techniques in lock latency arbitrage are sophisticated methods used by traders to mask their strategies in Forex markets. This includes varying lot sizes, using different trading instruments, employing multiple strategies on the same instruments, and integrating non-arbitrage buy signals.

Diversifying Lot Sizes for Lock Latency Arbitrage Trading

Purpose: By varying lot sizes, traders can avoid drawing attention to their arbitrage activities.
Implementation involves alternating between large and small trades to obscure the consistency that might indicate arbitrage.

Utilizing Different Trading Instruments

Expanding Scope: Engaging in trades with various instruments, such as different currency pairs or commodities, can disguise the arbitrage focus.
Strategic Diversification: This camouflages the arbitrage strategy and spreads risk across different markets.

Employing Multiple Strategies for Arbitrage Trading Camouflage

Blending Approaches: Using a mix of trading strategies on the same instruments can make it harder for brokers to detect specific arbitrage activities.
Example: Combining trend following, mean reversion, and lock latency arbitrage within the same trading portfolio.

Incorporating Non-Arbitrage Buy Signals for Arbitrage Trading Camouflage

Signal Integration: Mixing in buy signals from non-arbitrage strategies can provide a cover for the arbitrage trades.
Balancing Act: This requires skill to ensure the non-arbitrage strategies uphold the profitability of the arbitrage strategy.

While camouflaging in lock latency arbitrage involves a complex blend of techniques, traders must remain mindful of ethical boundaries and regulatory frameworks. The success of such strategies hinges on a delicate balance between effective camouflage and adherence to legal and ethical trading practices.

Final Note

Advanced camouflage techniques in Forex trading should be cautiously approached, considering the potential risks and the importance of maintaining market integrity. Traders must continually educate themselves and stay updated with the evolving regulatory landscape.

Conclusion

Lock arbitrage in Forex is a sophisticated, technology-driven strategy that allows traders to exploit market inefficiencies. However, its reliance on high-speed execution and the nuances of broker policies necessitate a comprehensive understanding of its mechanics and risks. As the Forex market evolves, so will strategies like lock arbitrage, requiring traders to stay informed and adaptive.

Future Prospects

Technological advancements, broker regulations, and market dynamics will shape the future of lock arbitrage. Traders employing this strategy must remain vigilant about changes in the Forex landscape, adapting their methods to sustain profitability in a constantly evolving market.

In 2005 we created our first robot for arbitrage trading. By the time we produced our first arbitrage robot for FIX API Trading ten years later, we had designed more than 50 connectors for many FIX API brokers. All of them work well with our programs.
The list of these brokers speaks for itself:
ADSS, ALPHA, BBO, BJF, CFH, CMC, CQG, CTRADER, CIRCLE MARKETS, CURRENEX, DUKASCOPY, EXANTE, FIRSTDERIVATIVES, FOREXWARE, FORTEX, FORTRESS, FXBA, FXCM, FXPIG, GAIN GTX, HOTSPOT, ICM, INTEGRAL, INTERTRADER, INVAST, LCG, LMAX, MATCHTRADE, MGM, NEXUS PRIME, OLFATRADE, ONETRADE,ONEZERO, PFD, PRIMEXM, PROTRADER, QTX, SAXO, SMARTTRADE, SPOTEX, SQUARED FINANCIAL, SWISSQUOTE, TRADAIR, THINKFOREX, TT, VISUALTRADING, XENFIN, XOPENHUB, i-Gold, Nexus

FIX API pros and cons

In this article, I would like to discuss those pros and cons of FIX API trading that are rarely mentioned by brokers.

Without question,the FIX API protocol is much faster than its and counterparts. This happens for a number of reasons that include the separation of the flows of orders and quotes, the absence of queues in order processing, and the absence of any and servers. On average, it takes only about 4 milliseconds to fill an LMAX order that is sent through FIX API, while it can take anywhere between 200 milliseconds and several seconds, depending on volatility, to fill the same order when sent through an broker using its A-book. These kinds of delays increase slippage, which in turn renders any trading strategy ineffective. It is no coincidence that, as recently as a few years ago, many brokers did not have any bridges to transmit orders for clearing (i.e., to the liquidity provider); they kept all orders within the firm in the anticipation that clients would lose their deposits.

Another undeniable advantage of using FIX API is the availability of IOC and FOK limit orders that help the trader control slippage.

The benefits of using FIX API are clear, but some qualifications have to be made.
When you trade through FIX API, you remove the server from the equation and, therefore, any intervention on the part of the broker. This is true so long as you’re not using toxic strategies (i.e., arbitrage). As soon as your FIX API broker identifies your trading as arbitrage trading, several scenarios can unfold:
1. If you use IOC or FOK limit orders, your orders will either be rejected outright or the fill will be delayed. The broker will try to explain this by citing a lack of liquidity at the top of the book and will promise to help you in the future, a promise that will come to naught.
2. Claiming that arbitrage trading is illegal and harmful to the broker’s systems, the broker will ask you to take your business elsewhere. We’ve seen this happen before. Such claims are completely false: arbitrage trading is neither illegal nor harmful to brokers’ technology, and we have yet to receive demonstrable proof that corroborates these kinds of assertions.
What explains brokers’ hostility to arbitrage trading in a real market that has a buyer and a seller? Bear in mind that many liquidity providers were once brokers.

Although they have evolved into liquidity providers, they have still remained in the gray zone, where they take all the risks by trading against you instead of sending your orders to the real market. In this situation, if you use arbitrage, the broker loses money. It should be noted, though, that as this part of the market is more sophisticated, using latency arbitrage will make it harder for the broker to flag you.

The above does not apply universally to all FIX API brokers. But even those brokers that use so-called gray technologies can still offer great platforms for arbitrage trading as long as the trader follows several rules. We have mentioned these rules before, and we’ll recapitulate them again.

FIX API Arbitrage Trading Rules

Rule #1 – this is the first and most important rule. Do not use latency arbitrage even if only to test brokers. It is better to start right away with Hedge or Lock Arbitrage. This will help make your FIX API accounts last longer.

Rule #2. Use additional strategies to create non-toxic flow. If you submit different kinds of orders through your broker, it will be harder for the broker to identify your trading as arbitrage trading – naturally, on condition that you use Lock or Hedge.
If you’re using vip versions, you can use a module that was specifically designed by us to create non-toxic order flow. Just remember to add other strategies (it is advisable and even necessary to use FIX API Trading platforms instead of arbitrage on some days; and it is especially important to do so at the beginning, before you start using arbitrage, as many brokers assess your trading tactics when you first start trading with them).

Rule #3. Don’t be greedy. Traders often come to us to report that our application is no longer working; when we analyze the performance of the program, we invariably see that the trader has taken profits far too quickly. The last statement that I’ve received shows a profit of 50% in ten days (we’d also like to thank the trader for giving us a good review). I am aware that some arbitrage systems providers publish data that show profits in the four digits, and I often hear from traders who complain that a profit of 4% is insufficient and a profit of 100% is more desirable. You need to be realistic. Some 5-7 years ago, when brokers were less cynical, a monthly profit of 500% was possible, although you would have had a difficult time withdrawing the profits. Today we do not recommend aiming at a monthly profit that exceeds 30-40%.  

We have unearthed a flaw in the way that gray FIX API brokers (I propose to call them that for the purposes of our discussion) operate. We’ve always known that you can’t close orders in a FIX API environment the way you can in an one. That is, you can do something similar by, say, closing a one-lot buy order on EUR/USD by opening a sell order for the same quantity. If you have traded on FIX API, you’ve probably noticed that there is a list of buy and sell orders that appears in the GUI, although some GUIs allow you to view this history in format.

However, gray FIX API brokers, especially those that use market makers’ plug-ins, still distinguish buy orders from sell orders. This can be done through currency exposure. If the exposure for EUR/USD equals zero, then a new order will be a closing order. As the broker is aware of the direction of the market, the broker then manipulates the feed, filling orders that are opened in the direction counter to the market immediately, while introducing slippage on orders that are opened in the direction of the market. However, this can be used against the broker!

As brokers read our blog, we would prefer not to disclose the specifics of the algorithm, but we do expect to deploy an update for our arbitrage software in the next several days. The update will be free.
I hope that the above will help our clients increase their profits. We don’t believe that the forex market should turn into a casino; it has to be a platform where all participants, brokers and traders alike, have the opportunity to make money. Brokers should be able to earn commission fees, while traders should have a chance to trade using any trading strategies they want. By the way, arbitrage trading is the tool that forces brokers and intermediate liquidity providers to transmit traders’ orders to the real market – which is how it should be.

Best of luck in your trading!

1. Open account with as many exchanges from our list (Binance,  Bitfinex, Bitmex, Bittrex, Bitstamp, Cryptofacilities, Gdax,
 HitBTC, Huobi, Kraken, Poloniex, YoBit ) as possible;

2. You do not need to deposit right away;

3. Start trading with Crypto Arbitrage Software  with as many currency pairs as possible in emulation mode for at least 5 days and also use crypto monitor software;

4. Choose 2-3 currencies and 2-3 exchanges with max activity;

5.  Deposit to these currencies/exchanges only;

6.  Make test trades with min possible lot sizes to make sure that API key are valid and settings are correct.

7. Switch from emulation to live mode for this currencies/exchanges keeping other pairs in emulation mode;

8. Check from time to time if these currencies still active, and if no - make changes:

   8.1 Switch inactive currency pairs back to emulation mode;
   8.2 Transfer funds to more active currencies;
   8.3 Switch active pairs to live mode;

9. Try to find best matching diff to open and diff to close values for your trading pairs.

Diff to open and diff to close should be adjusted to fit your actual diffs, for example, if you see 3.6%/-3.5% current diffs it is not optimal to set 0.8% diff to to open and 0.8% diff to close. It would be much better to set 3.6% or little higher % to open and -2.0% to close (negative values allowed here). You keep estimated profit the same (0.8+0.8=3.6-2.0), but closing conditions will be met much faster.

Information about these prodiuct: VIP Crypto Arbitrage software    

1. Issue with Bitmex exchange deprecated SimpleOrderQuantiy is fixed.
2. OKEX exchange introduced compressions to web sockets packets and going to deprecate API v1 soon.  We implemented their recent V3 protocol, but your old v1 API credentials will no work with it. So you need generate new V3 keys in next steps:

Step  1

Step 2

Step 3. In the window that appears , provide the passphrase and permissions. Don’t forget to store passphrase somewhere, as when you confirm key creation,  it will not be accessible any longer.

3.Under menu Sessions we have added new 2 points:

Save pairs and deals – by default application automatically stores all the changes to pairs and deals list once in 5 minutes.  But if you want to force saving of some important changes you can click this menu point.

Export all settings – if you need to move application to another  PC/VPS,  now you don’t need to enter everything from scratch. You can export the settings on our old VPS,  move the created settings file on new VPS, double click on this file to store settings to system registry, and then install and run the program. One Important  thing here: the app should be installed with the same license with which it was used on another VPS.

4. We have created Import and Export buttons in Session properties window.  That will also allow you to move sessions between 2 instances of the program or use some settings as templates.

The Crypto Arbitrage Monitor Software allows a trader to view arbitrage situations between different crypto currencies and altcoins and different crypto exchanges: Binance, Bitfinex, Bitmex, Bittrex, Bitstamp, CryptoFacilities, Gdax, HitBTC, Huobi, Kraken, Poloniex, YoBit in real time mode. This software also collects information and saves it into history files. Trader has possibility to export historical arbitrage situations into csv file and analyse it in MS Excel. Software shows: buy/sell exchanges names, arbitrage situation time of appearance, arbitrage situation duration currency, potential profit. Software calculates potential profits based on available volume on the top of book and considers spread and commissions.

Click to download Free Crypto Arbitrage Monitor Software

How to make this software useful for your trading?

If you collect data for couple days and then make analyze in excel to find:

1. Which coins and crypto exchange show more arbitrage opportunities. You can sort data by coin name in excel and check how many arbitrage situations for particular coin and between particular exchanges

1. How often the arbitrage situation appears
2. How long can be period between arbitrage situation and opposite arbitrage situation
3. How big volume is available of the top of the book

It is also will be useful to check information for each exchange:

1. All available deposit/ withdrawal options. Why it is useful?

For example you find that between Bitstamp and Binance a lot of arbitrage situations for BTCUSD, but in one direction only (BTCUSD price on Binance 5000 and you can sell it BTC, price on Bitstamp is 4805 you can buy BTC) you can wait for opposite arbitrage situation or calculate commissions for transfer  BTC from Bitstamp to Binance or to another exchange with higher price for BTC. It is only an example and you can do more complicated algorithm for your trading.   It will be also useful, if balance on one exchange is low, because the profit is accumulated on another one. In this case you can make transfer in allowed currency.

Almost all exchanges allow deposit / withdrawal in BTC, BCH, XRP, LTC, ETH, but not all allow deposit / withdrawal in altcoins, like poloniex for example

2. 1st CryptoTrader Software

1. Is API allowing you to make deposit/ withdrawal If exchange allows to make deposit / withdrawal via API, you can generate API keys with deposit / withdrawal possibilities and 1stCryptoTrader software.

Videos about FREE 1stCrypto Trader Prototype on several languages:

1. English

2. Русский

3. Español

4. プロトタイプ日本語

5. 原型中文版  我的国家不允许使用 Youtube: https://s3.amazonaws.com/1cryptotrader/1stCrypto-Trader-prototype-Chinese.mp4

Download 1st CryptoTrader Prototype for free

  Free prototype is available for download. We recommend you to make investment in this project ICO (1stCryptoTrader), because when this software will be ready, you will need DHT. You can use these tokens to pay for the all paid services associated with the 1stCryptoTrader application – e.g., to pay commission fees for traded volume, for usage, for signal and strategy purchases, etc.

3. VIP Crypto Arbitrage Software

After you collect and analyze all information you can use VIP Crypto Arbitrage Software for fully automated trading between crypto exchanges via API. We strongly recommend using different API keys for deposits/withdrawals via 1stCryptoTrader and for Crypto Arbitrage Software.

Based on information collected from Crypto Monitor software, you can adjust Diff to Open, Diff to Close, (based on price differences) trading lot (based on available top of the book volume) 

Allow Buy / allow sell – you can set based on your trading plan. If opposite arbitrage situation appears time to time and you do not  want to make any transfers and want to wait, you need to check both. If opposite arbitrage situation appears not so often, you can trade one direction and make transfers.

Click to learn more about Crypto Arbitrgae software and check our results>>>

Crypto Exchanges offer to trade pairs: altcoin/USD, altcoin/BTC and altcoin/ETH. We checked arbitrage situations and available volumes for altcoins and it is a lot of arbitrage situations daily, much more then for popular cryptocurrencies like BTCUSD, ETHUSD, BTCETH, LTCUSD… For example, for October, 2018 for all cryptocurrencies and 52 crypto exchanges we were able to find 8856 arbitrage situations. 

It means that we can make higher profit trading altcoins as well. It is almost not possible to open account with all crypto exchanges (and we do not have all connectors) and trade all crypto currencies, but you can expand the portfolio of trading coins. You can also move funds between exchanges and trade only exchanges with more arbitrage opportunities in past. For example, if you check following image,

you can find that 8 November 2018 where a lot of arbitrage situations between Binance and Huobi. You can move funds from your “home” exchange to these two (or more) and use VIP Crypto Arbitrage Software for fully automated altcoins trading until the situation changes.

You probably received information that we are working on creating new software for Crypto Trading – 1st CryptoTrader. If no, you can read about this project here: https://ico.1ct.io  and we recommend to subscribe to telegram channel where we post all updates: https://t.me/firstcryptotrader

So here, 1stCryptoTrader prototype is already available and everybody can download it and use it for free of charge now and the most interesting thing – you can easily move funds between exchanges with this tool.

You can download 1stCryptoTrader here download 1stCryptoTrader for free

Now we are working on creating Arbitrage Crypto Informer which will collect information from crypto exchanges and shows arbitrage situations in real time. This software will help you to decide which 2 or more crypto exchanges use for arbitrage trading now. This software should be available 15 November, 2018 for free for all VIP Crypto Arbitrage Software users.

 
Altcoins list

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Voxels (VOX) VapersCoin (VPRC) VeriCoin (VRC) VeriumReserve (VRM) Vertcoin (VTC) WAN Waves (WAVES) WAX (WAX) WorldCoin (WDC) Wings (WINGS) WePower (WPR) Worldcore (WRC) Walton (WTC) X-Coin (XCO) DigitalNote (XDN) NEM (XEM) Joulecoin (XJO) Stellar (XLM) Magi (XMG) Monero (XMR) PetroDollar (XPD) Primecoin (XPM) Ratecoin (XRA) Rialto (XRL) Ripple (XRP) Tezos (Pre-Launch) (XTZ) Vcash (XVC) Verge (XVG) ZCoin (XZC) ZClassic (ZCL) Zcash (ZEC) Zeitcoin (ZEIT) ZenCash (ZEN) Zetacoin (ZET) Zilliqa (ZIL) Zoin (ZOI) 0x (ZRX)

Crypto Exchanges List

Allcoin, Binance, Bitbay, Bitcoin-Co-Id, Bitcoins-Norway, Bitebtc, Bitfex, Bitfinex, Bitflyer, Bithumb, Bitkonan, Bitso, Bitstamp, Bittrex, Bitx, Bleutrade, Btc-E, Btcchina, Btcmarkets, C-Cex, Cexio, Coinbase , Coinexchange, Coinfloor, Coinmate, Coinone, Cryptonit, Cryptopia, Exmoney, Exx, Gatecoin, Gateio, Gemini, Hitbtc, Huobi, Idex, Itbit, Korbit, Kraken, Kucoin, Lakebtc, Lbank, Liqu,i Livecoin, Okcoin, Poloniex , Quadrigacx, Quoine, Therocktrading, Tidex, Tokenstore, Yobit.

Arbitrage can be a very effective trading tool when working with the cryptocurrency market. As cryptocurrencies continue to gain traction and widespread acceptance, there are many opportunities to make money. At the same time, there’s also more risk; and traders who are interested in cryptocurrency arbitrage need to be aware of it. If you’re one of those traders, this article is for you.

Arbitrage trading: what is it?

First, let’s define arbitrage trading. This kind of trading involves taking advantage of price differences that often crop up on financial markets in order to exploit the differences and make a profit. For example, for a number of reasons, the same financial instrument might be offered at different prices on two exchanges. The trader would simultaneously enter a buy and a sell order, purchasing the instrument from the exchange that has the lower price and, at the same time, selling the instrument on the exchange that has the higher price, thereby making a profit.

While this is a tidy way to make money, it has become very difficult for non-institutional traders to engage in arbitrage trading successfully with traditional markets. This is due to the fact that institutional market participants have been using increasingly sophisticated technology, eliminating the number of market inefficiencies and, consequently, the number of arbitrage situations present.

However, arbitrage trading can still be used profitably with cryptocurrencies. As the cryptocurrency market is a nascent market, it is vulnerable to inefficiencies that are far less common with a mature market; coupled with high volatility and volumes, this creates an environment that is conducive to arbitrage trading. Typically, such market inefficiencies as can be found come about as a result of the number of cryptocurrency exchanges in existence and the lack of industry consolidation: as large exchanges compete for business with small exchanges, demand and supply for the same coin can vary from one exchange to another. This is where arbitrage trading comes in.

Arbitrage trading and the cryptocurrency market

When engaging in arbitrage trading on the cryptocurrency market, there are a number of different strategies that a trader can utilize. The simplest one is called, appropriately one, simple arbitrage; it is centered on the simultaneous buying and selling of the same cryptocurrency on different exchanges. Another is called convergence arbitrage, which entails the purchase of a cryptocurrency on one exchange and the short sale of the same cryptocurrency on another; the trader then waits for the prices to be corrected by market forces. With triangular arbitrage, the trader exploits price differences between traditional currencies, buying and selling a cryptocurrency in these currencies to make a profit.

As an arbitrage trader, you also need to determine how you will scour the market for arbitrage situations. You can elect to do it the “old-fashioned” way, monitoring the market manually in order to identify an arbitrage situation. As this is a labor-intensive approach, though, there is an array of tools to help you, including arbitrage bots and trading applications.

Whichever strategy and trading approach are used, the objective is the same: to take advantage of an identified market inefficiency and make a profit.

An example

We’ll use a very simple example to illustrate how arbitrage trading works in real life. Let’s assume that you’re trading bitcoins (BTC). You’ve been monitoring the bitcoin price on two exchanges, ABC and XYZ, when you suddenly notice that the BTC price on ABC is $9,900 and the BTC price on XYZ is $10,000. Using simple arbitrage, you buy BTC on ABC for $9,900 and sell it on XYZ for $10,000, making a profit of $100 in the process. Naturally, this example, simple as it is, does not take into account any applicable transaction fees; but for illustrative purposes this will do.

Arbitrage trading: pros and cons

We’ve already mentioned several advantages of using arbitrage when trading cryptocurrencies. The cryptocurrency market is not a mature market, which provides fertile ground for all sorts of inefficiencies. It also offers a lot of volatility, which is important for arbitrage. Furthermore, there’s a plethora of cryptocurrency exchanges - the more exchanges there are, the greater the possibility of price differences and, therefore, profitable arbitrage situations.

However, with opportunities come risks. The cryptocurrency market has a number of drawbacks, pitfalls, and dangers that can hamper your ability to use arbitrage trading successfully and lead to losses. There might be all sorts of transaction fees that you’ll need to be aware of (cryptocurrency exchanges normally charge a transaction fee for trades), and there may be additional restrictions as well (e.g., daily limits on withdrawals placed on your wallet).

Due to the nature of arbitrage trading, you might have to constantly place large orders in order to make your arbitrage activity worthwhile. Also, the same volatility that is your friend when you’re involved in arbitrage trading can also be your enemy: high volatility can lead to price changes that will make it difficult for you to make a profit, since prices can change faster than you can transfer coins between exchanges. This is all the more so, given that slowness has been a problem with some cryptocurrencies and exchanges.

There are also safety concerns associated with storing coins on cryptocurrency exchanges. Crypto exchanges have experienced security breaches with their systems where traders’ coins are stored; coins can be stolen. Additionally, while the cryptocurrency market remains fairly unregulated, various regulatory requirements might prevent you from using certain exchanges, undermining your trading strategy.

Lastly, as cryptocurrencies become more popular, there’s a risk that arbitrage trading will become less effective as a growing number of sophisticated traders entering the market, combined with gains in technology, reduces market inefficiencies and the number of arbitrage situations.

Be aware and do your homework

Taking these risks into account will go a long way towards protecting your capital when using arbitrage trading on the cryptocurrency market. There are a number of things you can do to ensure that you mitigate the risk inherent in arbitrage trading when trading cryptocurrencies.

Stick to crypto exchanges that enjoy a sound reputation. Diversify - do not put too many eggs in one basket. Consider using hedging strategies. Be mindful of speed-related issues: transfer times with bitcoins, for example, are slow, so you might want to avoid using bitcoins when using arbitrage trading and consider other, more “speed-friendly” cryptocurrencies instead.

It is also a good idea to keep an eye on market developments, with two objectives in mind. One objective is to keep track of new coins that might be added to cryptocurrency exchanges: as newly added coins might not enjoy much demand initially on the exchanges on which they’ve just been listed, there might be price differences for you to exploit. The other objective is to be ready to trade when the market gets volatile (for example, when there is material news, etc.).

Finally, as with trading in general, make sure you have a solid action plan. You need to determine the amount of money you’re willing to trade and are able to lose, how you’ll transfer/store your funds, etc. Be sure to stick to your plan. Unless circumstances change to a point where the original plan is no longer workable, a good action plan will help you be more disciplined - always an important factor in trading success.

The best way to strat crypto arbitrage trading - start to use professional crypto arbitrgae software

Above all, make sure you understand the risks and do your homework. This will help you avoid mistakes and increase your chances of making money when engaging in arbitrage trading on the cryptocurrency market.

There's been a remarkable proliferation of crypto exchanges all around the world.  "The trading community understands the revolutionary potential of the cryptocurrency market. There are many opportunities out there. In order to take advantage of these opportunities, traders need the right technology to keep up with the growth of the market. In that sense, 1stCryptoTrader is a game changer. We've identified a niche, and we've delivered the right product.

In addition to supporting operations critical to trading, 1stCryptoTrader comes with a number of other functionalities that expand the scope of what traders can now do, and provides traders with tools to trade effectively on the cryptocurrency market. Traders can use 1stCryptoTrader to identify arbitrage situations. Traders are also able to buy existing robots or create new ones, use a diverse list of technical indicators, and work with real-time as well as historical data.

This application is all about empowering the trader.  Traders were previously fairly limited in their options. Even though most traders, professional and amateur alike, prefer to work on personal computers, they were unable to use their desktops to connect to crypto exchanges.

The lack of a proper application that supports desktop use hampers active trading, with possible negative implications for trading results. Without a desktop application, traders are forced to rely on extremely powerful computers and must quickly adapt themselves to different interfaces as they trade. 1stCryptoTrader eliminates these limitations and allows the user to focus on trading.

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46.4% of the respondents – the largest group by far – believe that cryptocurrencies are a good vehicle for long-term investments. The second most popular answer was that cryptocurrencies are a good vehicle for short-term investments (22.6%).

In my view, as is the case with the forex market, the risk associated with cryptocurrency trading increases with the duration of your orders. It is certainly true that just about all popular cryptocurrencies have experienced spectacular growth up to now and have made a lot of people wealthy. I also believe that the growth phase is not over yet: the fact that it is now more difficult to make money on the cryptocurrency market augurs well for future growth.

Nevertheless, short-term trading is less risky.

17.4% of the respondents think that cryptocurrencies are a market bubble. I can’t say that I share this pessimism: blockchain technology and the decentralization offered by cryptocurrencies make cryptocurrencies an exceptionally innovative tool, which justifies the growth spurt.

Watch an HBO interview with the founder of Ethereum, Vitalik Buretin.

We then asked whether the respondents had accounts with any crypto exchanges.

About half of all respondents appear to have an account, and half do not. It is actually very simple to open an account with a crypto exchange. Many crypto exchanges are very reliable and have been around for a long time. In fact, some crypto exchanges – exchanges such as GDAX and DSX – are even regulated (by the FCA).

Video: what are cryptocurrency exchanges

Our next question gauged how much the respondents knew about ICOs.

The majority of the respondents are not familiar with ICOs.

I recommend the following video, which introduces ICOs.

Our next question dealt with cryptocurrency strategies. 74.6% of the respondents consider these reliable.

We are inclined to agree with those who consider such strategies reliable. We have developed an application that allows crypto arbitrage via a socket API - Crypto Currencies Multileg Arbitrage Software; testing results have shown that this kind of trading is profitable and low-risk.

Almost half of all respondents (49.4%) are unsure of which crypto arbitrage method works best.

Just over 30% of the respondents believe that hedge arbitrage works best, and we agree with that. The decentralization of exchanges leads to constant discrepancies between them; however, these discrepancies might persist, sometimes for as long as several hours. A hedged position in this situation will protect your investment if the cryptocurrency price moves up or down.

To activate this indicator, click on "hedging pair" and then on "edit", and then activate the profit indicator.

The indicator uses a range of shades from red to green to indicate those pairs that are most profitable at the moment. For example, the indicator might show that the best pair for trading right now is BTCUSD on Kraken vs BTCUSD on GDAX. In that case, you don't need to invest money in any other exchanges; you can just move funds into these two exchanges and then trade BTCUSD. If it's some other pair, then you can trade that other pair. You can move funds from one exchange to another; that way, you will trade those exchanges and pairs that are best to trade right now. Again, this is a visual indicator that relies on colours to convey data. If unprofitable orders for the pair, the displayed color will turn red and the redness will become progressively brighter; and we'll give you a visual in a few moments.

If we starting to get loss-making trades. The green color is becoming darker and should  turn red. . The indicator is now telling us that this particular pair is not profitable to trade right now, and you'd be well advised to leave it alone.

So to summarize everything: this indicator makes it possible to move all of your pairs into simulation mode, monitor activity for a few days to get an idea of what's going on, and then select those pairs that are most suitable for your trading - and start trading.

Good luck!

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We have added new API Connector for https://www.cryptofacilities.com/  crypto exchange to our Crypto Arbitrgae Multileg Software.

Please take into account:

1. Cryptofacilities exchange doesn't allow market orders. So if you don't select market orders, the program will send limit order at current market price+ slippage

2. The minimal lot step is 1 USD, so the order volume will be rounded with 1 USD precision.

Already available conectors for our Crypto Arbitrgae Multileg Software

gdax, kraken, bitfinex, bitstamp, bitmex, binance, poloniex, bittrex, deribit, okex, cexio, huobi, Hitbtc, cryptofacilities

Video about Crypto Arbitrage Multi-leg Software

For many, however, cryptocurrencies remain a highly arcane concept, since not everyone understands how cryptocurrencies actually work. Cryptocurrencies are based on something known as cryptography, which serves as the foundation of cryptocurrencies. The aim of this article is to explain what cryptography is; this in turn will make cryptocurrencies a lot less mysterious to the reader.

Cryptography is the process of rendering information (typically, written information) secret by using a secret code (“crypto” denotes something hidden or secret in ancient Greek). With cryptocurrencies, cryptography allows users to stay anonymous and conduct their operations securely. The purpose of cryptography is manifold: perform verification, ensure that everything is secure, and assure that there is control over generating new currency units. Cryptography employs sophisticated codes in order to ensure that data transmitted between a number of users is only visible and legible to those users, thereby safeguarding the anonymity of the participants and upholding the confidentiality that they require, all the while protecting all parties against fraudulent intent. Essentially, cryptography aims to ensure that information relating to cryptocurrency transactions is not revealed to anyone who is not associated with these transactions.

To attain this objective, cryptography utilizes encryption to keep information hidden from unauthorized viewing. When a message is exchanged between parties, the sender encrypts the message by using an encryption key; the party on the receiving end then decrypts the message to make its contents legible. No one else will be able to make any sense of the message.

While not all cryptocurrencies make use of encryption with messages (bitcoin is one such example – bitcoin transactions are fairly transparent), a number of currencies employ various methods of encryption to ensure that all transactions involving these currencies remain anonymous (Monero and Zcash are good examples of such cryptocurrencies).

There are a number of methods used with cryptography. One such method is the symmetric-key algorithm method. In simple terms, this method uses the same cryptographic key to encrypt a message on the sender’s end, transmit it over to the sender, and decrypt it on the receiver’s end. Should the message be intercepted or viewed by a third party during transmission, that party will not be able to decipher the contents of the message – the message will be illegible. The level of complexity varies considerably with the symmetric-key algorithm method.

Another method used with cryptography is the asymmetric cryptography method (also known as the public-key cryptography method). This entails the use of two different keys: one is a public key, and the other a private one. The public key is disclosed; the private key is not and is only known by its owner. With this method, an individual seeking to send a message can encrypt it using the receiver’s public key; the message can then only be decrypted by the owner’s private key, known only to the owner. The use of a pair of keys provides an added level of protection for cryptocurrency transactions.

A third method is hashing. Hashing involves inputting various data that will then be rendered into data of a fixed length for output. In other words, regardless of the size of the data inputted, its output will be of the same size. This is used for data integrity verification. Hashing is also buttressed by the use of digital signatures, which ensures proper authentication and helps make the process more secure.

The outlined methods also lend themselves to customization.

While the above has been simplified for the reader’s benefit, by this point the reader should have a better idea of what cryptography is in the context of cryptocurrencies, and how it makes the technology behind cryptocurrencies more secure and efficient.

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It is important, however, to take a lot of broker reviews posted online with a grain of salt. It is well known that bad experiences get more publicity than good ones. Satisfied traders are usually inclined to keep their experiences private, while bad traders are far more likely to lash out at their brokers. Trading success is contingent on the use of a good trading strategy. As it is, many traders enter the forex market without a strategy; when they fail, they invariably blame the broker. Inexperienced traders often try to time the market or speculate on its direction, failing to realize that they're competing with sophisticated traders who are adept at taking advantage of amateurish attempts to beat the market. When the traders lose money, therefore, they believe they got shafted and hold the broker responsible.

As was mentioned, there is no shortage of unscrupulous brokers out there. They have a number of tools to help the trader lose money. The broker can attempt to "pad" the commission fee by playing with quoted rates and triggering stop orders. The broker can also use slippage (more on slippage further below). However, it's worth bearing in mind that brokers need you to trade if they are to make money. If you lose your capital, you're out. The broker can no longer make any commission fees off you. It follows that it’s in the broker's interest that you continue to trade. Your success is also your broker's success.

A few words about slippage. Many traders do not appreciate the fact that slippage is often inevitable and may end up blaming brokers for their losses. There is often no way to avoid slippage when the market is volatile. While the broker will try to do the best it can to fill your order at the price you want, this might not be possible when there are wide swings in the market, and you might experience slippage. You can protect yourself by going with a broker that guarantees to honor your limit or stop order prices, but not all brokers offer such guarantees.

How do you go about choosing a legitimate broker that will help you grow as a trader?

First of all, do your research. Be sure to read broker reviews online; while some skepticism is warranted, you can still get a good picture of how a broker is perceived by traders in comparison to the broker's competitors. You can use your judgment to determine whether a bad review left about the broker is a valid complaint about the broker or just a case of an embittered trader. Note any complaints about poor communication on the part of the broker: a good broker is a broker that communicates well.

Pay attention to reviews that claim the broker did not permit the trader to withdraw funds from the trader's account, as this is a big red flag. It is also a good idea to confirm whether the broker is in good standing with the regulatory authorities – FINRA, for instance, offers a broker verification service (BrokerCheck) that does just that.

Once you've decided on a broker, it is time to open an account. Be sure to read all the account opening documentation carefully to avoid unwelcome surprises further down the road. Read the fine print and all the disclaimers, particularly with respect to incentives and promotions that are often too good to be true (this might be the case with sign-up bonuses, for instance). It is dry reading, but you should read it anyway. It will spell out your rights and help you avoid pitfalls further down the road.

If you're happy with the terms and conditions as outlined in the documentation, you might want to deposit a small amount of funds and trade for a few weeks or so. This will help you get a feel for how the broker operates. Should you end up losing money, it will not be a substantial amount, and you'll be able to move on to another broker.

When dealing with brokers, you should also be on guard against churning. Churning involves the buying or selling of financial instruments by a broker in a client's account with the intention of boosting trading activity and, consequently, commission fees. The broker enters unnecessary trades solely to earn commission revenue, without there being any discernible benefits for the client. While this practice is illegal in the US, as with many other practices that are illegal, there's no guarantee that a broker will not engage in it. Churning is only possible if the broker has discretionary authority over your account (i.e., the broker can make trading decisions without prior authorization from you – the broker does not need to obtain prior approval each time the broker wants to establish a position). If the broker does not have discretionary authority over your account – if all trading decisions originate with you – the broker should not be able to engage in churning, since any trades done without your permission are unauthorized trades.

In cases where a broker has discretionary authority over a client's account, to ensure that no churning occurs, the client can keep tabs on the broker by evaluating whether the trading activity in the account is appropriate for the client's risk profile and investment objectives. Trading activity that appears to be unduly frequent and/or does not seem to serve any identifiable purpose might also be a sign of churning. If you believe that you're a victim of churning, you should contact the regulatory authorities and, if appropriate, seek legal counsel.

Despite all precautions, you might still find yourself in the unfortunate situation of having to deal with an unsavory broker. If that’s the case, your first course of action should probably be to contact the broker. It's worth it to see if you can reach some kind of an agreement with the broker; there's always a possibility that the broker might prove to be accommodating. There's also a possibility that the broker might have acted properly in that particular situation, so be sure to review the pertinent documentation as well.

If you still believe the broker has acted improperly, inform the broker that you'll be obliged to review your options and take such further steps as may be appropriate. Your options might include lodging a complaint with the relevant regulatory authorities (e.g., FINRA) and/or posting a negative review online.

To sum everything up, be sure to do your homework when looking for a broker. When you do decide on one, start small by depositing a modest amount of money. If the broker is a good one, you’ll be able to trade with that broker for as long as you need to. In the event that things do go wrong, however, you won’t end up facing severe losses if you start small. Finally, you also have some options at your disposal if the broker acts unethically or does something that’s illegal.

Have you ever traded via FIX API?

In response to our “Have you ever traded via FIX API?” question, more than 50% of the respondents selected “No, because I do not know anything about FIX API”.

This is something that many traders really need to work on. If you are serious about approaching the forex market as a place where you can make money consistently and not as you’d approach a casino, you will need to get familiar with FIX API. This should be a top priority – even more so, given that all the information is easily accessible and does not require any specialized knowledge. If you limit yourself to trading, there’s a good chance that you might end up being disappointed with your trading results, as you’ll find that most trading strategies simply don’t work. This is due to a number of reasons: slippage, slower execution times, filtered quotes, active dealing (i.e., broker manipulation), etc.

You can learn about FIX API by subscribing to our articles related to this topic. Additionally, if you have specific questions, we’ll be happy to address them.

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More than 20% of the respondents answered this question in the affirmative. If you need help creating strategies for FIX API, we are ready to help you improve your results.

The third most popular response is “No, because FIX API Brokers require higher deposits than / brokers”. While this is true, a growing number of brokers are offering to open FIX API accounts for clients with deposits of $500 and lower. We encourage you to ask us for recommendations.

Have you ever traded cryptocurrencies?

Most respondents said yes, which shows that cryptocurrencies are now a part of our lives – and permanently so, we believe.
“No, because I do not know anything about cryptocurrencies”.

A cryptocurrency is essentially virtual money that is encrypted and protected with the help of algorithms. What sets cryptocurrencies apart from such payment platforms as PayPal is their decentralization and their independence from such institutional structures and hierarchies as banks and governments. Cryptocurrencies are facilitated by blockchain technology, which allows consistent cryptography of all trades.

What are cryptocurrency exchanges, and how do they work?

In practical terms, cryptocurrency exchanges are virtual platforms that allow users to trade cryptocurrencies or exchange them for other assets.
Many such exchanges support trading cryptocurrencies for fiat money or vice versa, although the scope of assets supported for trading varies one crypto exchange to another.
Trading one cryptocurrency for another is possible if the exchange has a corresponding pair that it supports. For example, if an exchange supports BTC/LTC, it means that bitcoins can be traded for Litecoins. If that currency pair is not displayed by the exchange, it means that you cannot do such a trade. The same applies to fiat money.

It is fairly easy to get set up to trade on a crypto exchange. The typical process is as follows:
1. Register. In most cases, registering on a crypto exchange is no different from registration on other websites.
2. Deposit funds for trading. Depositing crypto funds does not usually involve any fees, although it is more common for crypto exchanges to charge a fee when fiat money is deposited. Commission fees charged by crypto exchanges can be as high as 8%, although they usually fall within a range of 1-5%. The size of the commission fee depends considerably on the payment method used to deposit the funds: as exchanges are not inclined to pay commission fees levied by other payment systems, they usually add such commission fees to their own fees, which increases the size of the overall commission that has to be paid by the user.
3. Create an order to buy or sell a cryptocurrency. The user specifies the price at which the user seeks to buy or sell the cryptocurrency in question, and starts trading by placing the order in the general queue.
If there is a party willing to be on the other side of the trade at the requested price, then the trade is made. If the price is too far from the market, a counterparty might not be found. There might also be no counterparty if the cryptocurrency associated with the buy/sell order is highly unpopular.
Once the trade is done, the user can withdraw the funds from the exchange or keep them in the exchange wallet for future trading.

Trading can be done either manually or in automated mode through API, which brings us to the third most popular answer.

“No, because I have no strategies/software for cryptocurrency trading”.

We can help you create strategies for trading – you need only contact us.

“No, because I think that it is risky trading”.

Risk is a function of the strategy that is used. If you’re using short-term strategies for arbitrage purposes, your risk is practically zero. Long-term strategies are riskier, in my view, as cryprocurrency prices are volatile and can swing in either direction by 10-20% in a matter of hours. It doesn’t take a lot of time to make money with cryptocurrencies, but it doesn’t it take much time to lose money, either.

Have you ever used Arbitrage Software?

The respondents overwhelmingly said yes.

However, we were surprised by the second most popular answer: “No, because I think that it is illegal”.
We have written extensively about this topic. Every arbitrage strategy is legal. We encourage you to read the following article:
https://www.investopedia.com/articles/investing/032615/why-arbitrage-trading-legal.asp

“No, because I think that it is risky trading”.

This is a misconception. I can say with a high degree of certainty that this is the most profitable and least risky method of trading.

“No, because I think that it is not profitable now”.

I agree that many brokers try to hinder arbitrage trading and make money by trading in the B-book, but an increasing number of brokers are not trading against their clients. Although these strategies are broker-sensitive strategies, the performance results that you can achieve with them are likely to surpass your expectations.

If you test software on demo, special on FIX API accounts, we recommend following these rules as well, because broker can check your trading results to understand your trading style.

If you open accounts under different names, you should have different addresses and phone # and email as well. Accounts should be opened at different times (at least few days between sign-ups).

You should open each account from different IP address. We strongly recommend using “IPs Changer” software to emulate trading from 2 different IP addresses, because broker can check not only IP address from which account was opened, but IP address for each order.

If you already used IP address for any particular broker, you need to change IP address. It is easy to do with IPs Changer Software. Just need to order new VPS with new IP address and change connection parameters in Lock Arbitrage. You do not need to have expensive VPS  for IPs Changer software.

Using Lock Arbitrage together with IPs Changing Software makes your trading style absolutely indeterminate for the broker.

We do not recommend sharing with broker any information about your strategy, trading style, software which you are using. We do not recommend asking broker about any help with settings.  it is not worth trying to negotiate with the broker about the use of arbitrage strategies - this is almost impossible. You should not trust a broker even if he takes care of you and tries to “help” you in every possible way.

I repeat this several times, but I know that our customers sent the broker a screenshot of the program, asking you to check the settings. By doing this you harm not only yourself but also our other clients. If you need any help – we happy to support, you and resolve any problem.

We do not recommend using any IBs links with the purpose of obtaining additional profit. Accounts registered under the same IB, can be quickly flagged, because of the same trading pattern.

Please do not use free vps from broker – broker will be able to check what kind of software you are using and flag your account.

Always use trading pause 2m (120ms) or higher.

Do not start trading with high lot size and all available symbols. Increase lot size smoothly and change trading symbols time to time.

Only by following these rules will you enter a different level of trading and will receive a constant profit without changing accounts and brokerage companies.

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Today I’d like to talk about the new functionalities that we’ve added to our Multileg CryptoArbitrage automatic software and about the new version itself. We have created video explanation on English, Chinese and Japanese languages. . If the exchange allows you to use socket API, it’s best to choose that. This information can be obtained either from the cryptoexchange or from us. Socket API will be faster and more reliable. If that’s not possible, then you choose Rest API. The Trade Connection Type can only be Rest.

You can adjust software in emulation mode and real mode. Emulator mode – that’s trading emulation, so prices will be obtained from the exchanges but orders will be opened as they would be in demo mode. We recommend setting all currency pairs in emulation mode when you first start in order see how things work out. I will check this off to enable it.

Slippage for opening and closing – for bitcoins I recommend entering 100. For other cryptocurrencies you can use lower values, typically 1-2.

Profit Mode – for ease and convenience we recommend setting this to currency; that way you’ll be able to easily tell how much money you’re making. You can also set levels for commission fees, if applicable – let’s say 0.2%. So our profit will be expressed in currency terms and the difference input in percentage terms (that’s 0.8%); we’ve also entered values for commission; and we have Emulator Mode turned on.

I’d also like to talk about the Dynamic Close parameter. So there are two ways of closing orders. You can use the Difference to Close approach, which means that orders will be closed when there is a difference of 0.8%. The other approach is to enable Dynamic Close and input the profit level that we want to achieve, in currency terms, which means that orders will be closed when this profit level is reached. Dynamic Close is recommended for more experienced traders who can calculate projected profits based on the lot sizes that they trade and the currency prices, so when you’re starting out, it’s better to use Difference to Close to see what your profitability is like before experimenting with Dynamic Close. Learn more about Crypto Arbitrage SoftwareWe recommend creating as many as currency pairs as possible and then selecting “Emulation Mode” for them for a few days. This will let you see which pairs have the most arbitrage situations. If I see that the ethereumUSD pair has the most arbitrage situations, there’s no point in investing money in trading the BTCUSD pair at the present time. So I will take ETHUSD off emulation mode and actually trade it. Once I see that things change and BTCUSD offers more arbitrage situations than any other pair, I will put ETHUSD back to emulation mode and disable emulation mode for BTCUSD to trade it.

Video on Chinese

Crypto Arbitrage SoftwareTrading Results

Already Integrated Crypto-Exchanges

Crypto-Exchanges 

We often encounter clients who want to first test a trading strategy with small amounts of money before committing larger sums.

Often traders and investors are different individuals. The trader needs to convince the investor, which requires good trading results. When the trader does not have sufficient funds, he is forced to try to achieve good trading results by using small amounts of money.

This approach is understandable, but it doesn’t make it a good approach. Managing $1,000 is not the same thing as managing $100,000 – the technology, money management tools, and brokers that are used will be very different in these two cases. The methodology used with $1,000 will be nothing like the methodology used with $100,000.

Let’s look at some of the methods available to different kinds of investors. I am going to break them down into different levels, but this is not an exact science. If you’re planning on investing $10,000, you can do as well with the method recommended to investors who have $100-8,000 as with the method recommended to investors who have $8,000-50,000. But this will still serve as a good point of reference.

When you have several million dollars to invest, I recommend opening a prime account with a company such as abnamro.com. Once you create your own liquidity pool based on the PrimeXM bridge, you can use multileg arbitrage with the help of our Multileg VIP Arbitrage software, comparing prices between different providers. At the same time, you can sell liquidity to brokers.

Investors with $30,000-50,000 might do well with two FIX API accounts used in conjunction with Hedge Arbitrage. The accounts should be with brokers who have their servers in the same data center, but with different liquidity providers. Many clients often confuse liquidity providers with technology providers. PrimeXM or oneZero are technology providers that will help you connect to a liquidity provider (such as Invast or CFH) via FIX API.

In other words, you can have a PrimeXM FIX API connection for two different brokers and use our hedge arbitrage software, but the technology providers can be different.

If you have $10,000-30,000 to invest, I recommend having two FIX API accounts and locking arbitrage, and/or one FIX API Account and two FIX API accounts or one account and hedge arbitrage. Both applications will work well. When using lock arbitrage, it is desirable to use FOK orders in order to control slippage; if the broker does not support FOK orders (i.e., if they are not built into the protocol), you can also use market orders for the purpose, since slippage with FIX API will still be lower than with . Do not use IOC orders as they might lead to incomplete fills, which can cause imbalances between your locks and, consequently, cause losses.

When using hedge arbitrage with two FIX API accounts, we also recommend the use of FOK orders. If you know which of the two brokers is the faster one, you can try enabling the “open on slow first” functionality. In that case, the application will not open orders with the faster broker until they’re opened with the slower one. In that case, you can avoid a situation where an order fails to open with the slower broker for some reason and an order is closed with the faster broker with a loss.

For investors with $1,000-10,000, it is best to use locking software with two FIX API or two brokers. If FIX API brokers are used, it is better to use FOK orders; if these are not possible, then market orders can be used.

Finally, for investors with $10-1,000, we recommend locking arbitrage with two brokers. After some four weeks, latency arbitrage can be turned on – if, for example, some news is about to come out.

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BTCUSD crypro-arbitrage settings 

We recommend to use for crypto currencies BTCUSD, ETHUSD, XRPUSD "Diff to open" and "Diff to close" 0.8-0.9 %

ETHUSD crypro-arbitrage settings 

LTCUSD crypro-arbitrage settings 

If currency has hihg volatility period like LTCUSD during last 2-3 weeks, you can use "Diff to open" and "Diff to close" 1%

You shold take intoaccount lot size. Lot size depends from your account balance and currency price. For exmple BTCUSD price 10 000 and to trade  1 lot you need to have balance arpund 20k, but price for ETHUSD 700 usd and to make the same profit, you need to trade 10 lots and for LTC USD 100 lots

CryptoArbitrage Crosses trading

LTCBTC crypro-arbitrage settings 

For all crosses like LTCBTC, ETHBTC....   we recommend to set  "Diff to open" and "Diff to close" 1%

Like we mented before, we recommend to have adjusted all possible currencies and exchange combinations, to have stats nd information which one currency is the most active for now and it means the most profitable. To make posibility to add new pair easy, we have added new functionality: settings clone. Click right mouse button on softwre icon and select Hedge Pair -> Clone. The software will create one more pair with the same settings.

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Since we launched our crypto arbitrage solution we have received a lot of feedback from our clients. Some people share with us their great statements while other complain that they have lower proifitability.
Along with other markets, crypto currencies market changes from time to time and currencies that work good before, may show not so good results today.

What should you do in this case? How to stay on the wave?
Guided by the accumulated experience of our clients, we want to give you some tips for improving your crypto arbitrage performance.

First of all, you shouldn't get stuck on a single arbitrage instrument. ( to trade for example only BTCUSD)
We recommend you to add in emulation mode as many currencies as possible. This will allow you to monitor and it helps you not only compare different currency performances but more importantly the frequency of arbitration situations .

For example, you see that you are getting trades on btcusd rarely at the moment, but ltcusd shows many frequent trades, so it is wise in this case to put btcusd on hold and switch to ltcusd.

How to adjust correct difference to open

Another problem that price for most cryptocurrencies changes very often and differnce for open when BTCUSD price  =11000 should be diffrent if price for BTCUSD  =17000. I this case we have added posibility to set Diff tom open in percents from current price for pair. 

For example if you set "Difference imput = percents and diff to open 2, software will calculate different to open based on current price for particular symbol. For example if price for BTCUSD now $11000 and you set Diff to open = 2% software will open order when Difference between price on exchange 1 and exchgange 2 will be differ on $220

If price 17000, software will wait for difference $340

We recomedn to use "Dinamic close" as well to improve your difference to close. If you set "Profit target in currency" = 150, software will close order when difference to cose = 150 usd (We take into account comissions)

Warning: Difference to open 2% and difference to close = $150 is not recommed settings! We provide recommended settings via email.

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Typically, ordinary retail traders use or accounts, or perhaps cTrader or NinjaTrader. None of these are ideal. When an order is sent, say, from an terminal, it will be sent to an server through a protocol created by – a protocol that leaves much to be desired. For one, it is slow, which creates a delay while the order is being transmitted. Also, if you’re in the A-book (i.e., you’re trading on the forex market), the order will be sent through a bridge that connects the server and the liquidity provider – and that is the best-case scenario. In the worst-case scenario, there will be a few more intermediaries along the way.

Let’s stick to the best-case scenario: the order goes from the server to the bridge. There is a delay here, following which the order is moved from the bridge to the liquidity provider, which takes place through FIX API protocol. The order is submitted to the liquidity provider; the liquidity provider then returns the order to your terminal with the price it was able to offer at the time, and the order now becomes an open one on your terminal. The delay produced by this sequence of events can reach anywhere between 100 milliseconds and several seconds. This is because the price is liable to change during this timeframe, and high slippage can occur.

If, however, you trade with a FIX API broker (i.e. through FIX API protocol, which is one of the fastest of its kind and is used by financial institutions), the order will be transmitted directly to the liquidity provider and filled right away. Orders delays can be as low as three milliseconds; slippage will be minimal as well. This will have quite an effect on your profitability.

Another advantage of using FIX API is the ability to use limit orders such as fill-or-kill (FOK) or immediate-or-cancel (IOC) orders. When you send such an order, you get to specify the slippage you’re willing to tolerate. For example, you might send an order with a price of 1.35 and a slippage of 1 pip. The broker will fill the order at the requested price with a slippage of one pip, or better, but not at a price worse than the one specified. If the broker cannot fill it at the requested price or better, the order will be rejected; but there will be no slippage and, therefore, no losses on your end.The difference between an FOK order and an IOC order is that an FOK order instructs the broker to either fill the entire order at the requested price or kill it in its entirety, while an IOC order can obtain a partial fill. For example, if you submit an FOK order for 10 lots, the broker will either fill the entire ten lots at the requested price or better or, if the liquidity isn’t there or the price has gone the wrong way, will reject the whole order; if you send an IOC order for 10 lots, the broker might fill 5 lots and reject the rest, if the rest cannot be filled at the requested price or better.

The experienced trader is well aware of these two advantages of FIX API, both of which help improve the trading strategy used and give the trader an edge over others.

A few years ago, I would not have been talking about FIX API. Back then you needed to have at least $20,000 – and often more – to open a FIX API account. Now you can open one with as little as $500. FIX API accounts are no longer the exclusive preserve of institutional clients; they are now accessible to retail investors who can open a FIX API account at any time and use it for their trading. As a matter of fact, cTrader automatically offers FIX API accounts to any client who opens an account with the company. For example, if you open a cTrader account with $200, you need only click on the “FIX API Credentials” button in the platform in order to receive your FIX API credentials that will let you trade directly through FIX API, without having to use the cTrader platform. That said, we recommend using FIX API accounts and not cTrader FIX API accounts, as they do not yet provide FOK or IOC orders and, as we believe, there is an additional server that is present with cTrader, which might result in delays.

What do you do once you have a FIX API account? You probably have some trading strategies that were developed for your terminal. How do you use them in your FIX API accounts? There are several approaches here. You can use an application such as FIX API Platform, which will enable you to use a FIX API feed to trade in automatic mode in , or send orders to a FIX API account without any delays. Alternatively, you can rewrite your advisor in C++ or C# for FIX API protocol. The cheapest option, however, is to go with an application such as FIX API platform.

What trading strategies work best with FIX API accounts? High-frequency strategies will certainly work well – that is, strategies that open many orders and do so frequently, and that are sensitive to order execution time and to slippage. Strategies that are oriented towards trading the news, where slippage is an important factor in the trader’s profitability, are also compatible with FIX API accounts. However, you’re not limited to these strategies; many others can be used as well. Bear in mind that a FIX API account practically excludes intervention on the part of the broker. terminals and servers were created for brokers and therefore offer dealing functionalities that make it possible for brokers to interfere in their clients’ trading – in your trading. The broker can engage in price manipulation or reject your orders if needed. As a trader, you might have seen many errors or instances of a dropped connection in your terminal – if your trading strategy is successful, a broker using the B-Book model or the hybrid model has every reason to get in the way of your trading and your profits. To avoid all this, you can use FIX API accounts. They will let you avoid external intervention in your trading; and, if your trading strategy is truly successful, it will work without any problems.

Also, if you calculate the amount of money you pay in commission fees and in spreads to brokers that buy liquidity from FIX API brokers and liquidity providers, you’ll realize how much money you can save when using high-frequency strategies. If a broker offers you terms that are considerably better than those offered by a FIX API broker, it is highly probable that the broker has a B-book or uses a hybrid scheme – simply put, the broker does not want your commission fees, but your whole account.

If you want to learn more about FIX API trading and how to use your strategies with FIX API, be sure to subscribe to our feed. We will be happy to send you a few videos that will provide further information.

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For example if you trade BTCUSD, you can set Diff to open and diff to close in USD. In this case it will be easy to adjust more currecies and catch more arbitrage oppotunities. Based on our expirience we can recomend to adjust all available crypto currencies in emulation mode and if one or several currencies became more acrive - switch this one in real trading mode.

OKoin Crypto Currencies Exchange

We alos added new crypto currencies exchange okcoin.com

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https://www.okcoin.com/ - will be added next week

Bittrex  and Deribit crypto exchanges do not support market orders and support only limit orders. You can use limit orders and in this case you need to spesify slippage, but you also can to imitate market orders and in this case you need to select market orders and set big value of slippage.

In this case order will be executed wit the same rules like market order.

Good luck!

For example we adjusted 3 Difference to Open levels for BTCUSD currency:

1 level  Diff to open = 19000

2d level Diff to open = 20000

3d level Diff to open = 25000

if the program receives quotations (ticks) from two exchanges differing from each other on 19000, and then next tick on 25000 - software will open 2 orders based on level 1 and level 3 settings.

Based on the experience of our company, I have concluded that arbitrage trading is the most profitable and least risky kind of trading available to traders. It also happens to be the most promising one. 

There are several myths associated with arbitrage trading. These myths need to be debunked, and I will attempt to do just that.

The first myth is that arbitrage trading is illegal. This myth has been created by unscrupulous brokers and continues to be cultivated by them because it serves one of their objectives – to help you part with your deposit. And the truth? Here’s what Investopedia has to say about the topic in a relevant article: Arbitrage is the exploiting of price discrepancies within different markets of a similar or identical assets in order to generate low-risk to no-risk profits, after accounting for transaction and information costs. Arbitrage trading is not only legal in the United States, but should be encouraged, as it contributes to market efficiency. Furthermore, arbitrageurs also serve a useful purpose by acting as intermediaries, providing liquidity in different markets. “Read more: Why Is Arbitrage Trading Legal? | Investopedia https://www.investopedia.com/articles/investing/032615/why-arbitrage-trading-legal.asp#ixzz54YOIO8B3

If a broker explicitly forbids the use of arbitrage trading, it means that that broker makes active use of the B-book, and that its technology is not sufficiently developed to detect arbitrage trading and switch your trading to the A-book. It might also mean that the broker works exclusively with the B-book.

It is pointless to trade with such brokers when you use ordinary latency arbitrage, since it makes it easy for the broker to refuse to hand over to you your trading gains – the broker will simply use your short-term profits of 1-2 pips as a pretext to enforce the “no arbitrage trading” clause. However, by using locking arbitrage strategy  or hedge arbitrage strategy, you will increase the duration of your orders to several hours and your profits to double-digit pips.

The illustration below shows the trading results obtained by using locking arbitrage. You can see that the order duration varies from several minutes to several hours, and that the profit on the trades varies from single-digit pips to 180 pips. Additionally, the software can be adjusted to produce more conservative numbers – for example, in case the broker requires minimal order duration of several minutes.

Using this method will make it difficult for the broker to withhold your profits. Should the broker still decide to give it a try and send you a letter advising you that you used bogus prices and damaged the broker’s server, you should let the broker know you will take the matter up with the regulator and, if necessary, make good on the promise.

Our clients have experienced instances of this; in 99.9% of all cases, the outcome was in the client’s favor.

Speaking of brokers’ servers, another myth associated with arbitrage trading is that such trading damages them.

Here is a simplified illustration of the typical communication flow of an STP (DMA) broker: 

 In other words, if you send, say, an order to buy EURUSD at 1.34569 and the liquidity provider confirms the order at 1.23570, this order will be executed on the server with a price of 1.23570 and a slippage of 1, and displayed on your terminal. I am thoroughly familiar with the way servers work; I am also familiar with many bridges – sufficiently familiar to tell you that arbitrage trade will not be detrimental in any way to a true STP broker and its bridge. The broker will pocket its commission fees regardless and be quite content. 

You have to understand that your actions here are absolutely legal, and you’re not breaking any rules.

What does your broker know about your trading? A myth exists according to which your broker knows everything about your trading. That is far from true. Let’s take a closer look.

Does the broker see the IP address you’re using to trade? It is visible in the administrator log.

However, most brokers do not have white labels; they only have the manager, the rights of which can be severely curtailed.

Can the broker see the magic numbers and comments you use, and whether you’re trading manually or with the help of an expert advisor?

While the broker has access to this information through the manager, if you use manual emulation, the broker will only see that you’re trading manually.

The illustration below shows a screenshot of an administrator account in which locking arbitrage software with manual emulation is used for trading.The broker does not see the magic number and identifies all account activity as manual trading. Bear in mind that the comment should always be unique. Any comment already in use should be changed to your own.

Possibly the most common myth centers on the coming demise of arbitrage trading. We first heard that arbitrage trading would soon die when we created our first arbitrage robot. It’s now been more than ten years, and our clients are still making money by using arbitrage advisors. Although it’s true that brokers are constantly coming up with new plugins to hinder arbitrage trading, arbitrage robot developers have no difficulty keeping up.

The idea of dynamic close feature is to use not the close difference specified in pair properties, but calculate close difference dynamically depending on the profit you want to get for the deal.

In Profit Target field you need to specify the profit you want to get for the arbitrage deal.

If you set Profit calculation mode to Points, you will need to specify Profit target value and Comission1 and Comission2 in points.

If you select Profit calculation mode in Currency, you will need to specify Profit target value in currency and  Comission1 and Comission2 in precents.

For example for BTCUSD pair, there can be the case when you specified diff to open to 10000 and difference to close to 10000 (so you want to get 20000 points total (minus commissions!)). But the trade opened with 20000 difference. So in this case you don't need to wait for close difference to become 10000, 0 will be enough to match you trading conditions.

In this case setting Profit target to 20000 will do the trick. But also you need to think about commissions applied to each trade!

That is why this "points" approach is more suitable for FX trading, where commissions are usually set (or can be expressed)  in points. Cryptocurrency exchanges commissions are in most cases applied in precents of traded volume.

For example, if you buy 0.5 BTC for 10000 USD, and the commission is 0.3 % on this exchange, the exchange will charge you by 0.5*10000*0.003 = 15 USD for this trade.

So for you not to bother with this calculations for each trade, you can just use the Dynamic Close feature with Profit target specified in currency. In this case you specify how much profit you want to get in quoting currency, and the program will itself calculate the necessary difference to close to reach it , based on the current prices, lot sizes and commissions that you specified. Once the conditions are met, the program will close the deal. 

You need to set your commissions for each exchange in presents to have information about real profit for each your trade </>You can view this video to understand how real trading emulator works

If your exchange has no margin trading option, to trade BTCUSD on exchange you need to have balance in BTC and in USD, to trade ETHUSD: you need to have balance in ETH and USD, etc.

You can deposit on any currency (some exchanges allow to deposit only in crypto currencies, but some exchanges allow to deposit in your local currency like USD or EUR), and the exchange inside platform. For example, you wold like to trade LTCUSD and you made deposit to exchange in BTC. In this case you need to buy USD for BTC and LTC for BTC.

Account size

How to calculate what minimum deposit do you need.

For example, you would like to trade BTCUSD. Minimal lot size allowed by exchanges 0.01 and if bitcoin price now = $19,000 to buy 0.01 btc you need to have $190 on USD wallet and 0.01 BTC on BTC wallet on each exchange. But we recommend to have little bit higher balances.

“Difference to open” and “Difference to close”

We have created Crypto Currencies arbitrage calculator. You can use  this calculator if you’re using our crypto multileg arbitrage or if you’re using an arbitrage strategy of your own. And you’ll need it in order to calculate the difference to open and the difference to close, and in order to cover the commissions charged by the exchanges and to make money. As crypto currencies are highly volatile – they can move up and down sharply – you’ll need the calculator to make recalculations as frequently as needed in order to keep up with the volatility. For example, if your Bitcoin goes up from 15,000 to 17,000, it is advisable to recalculate your difference to open and difference to close to make sure that your arbitrage orders will cover all the commission fees.

So how does it work?

Let’s select the first pair exchange – we’ll go with Bitstamp and “bitcoinusd” as the currency. The second pair exchange will be bitfinex and the currency will also be bitcoinusd. The application automatically sends a request for prices, which it then displays. You can see the bid and the ask for both exchanges. The bitstamp prices are at the top, and the bitfinex prices are at the bottom. Next you have to set your difference to open. Let’s say, 10,000. You can drag it to get an approximate number and then use the plus/minus buttons to get the exact number that you want. We’ll just leave it at this. You do the same thing for the other pair – we’ll set it to approximately 10,000. And then you have to specify the lot size you want. For example, if you want to use 001, which is the minimum lot size on the exchange, you choose that; or you can set the lot size to 002 – that’s entirely up to you. We’ll go with 002. You then set the commission rate for each exchange.

Commission rates vary – the typical rate is 0.2; it can also be 0.25 or 0.3, or perhaps a different rate, since commission rates depend on the volume traded – with more volume, the commission rate falls – so you need to set the commission rate that you’ll be charged by the exchange. You then click on “Calculate”, and the application calculates your commission fees, you first and second profits, and the total net profit once the commission fees are deducted. So, with a lot size of .02, this is the profit that you will receive from your arbitrage trade.

You can then calculate your daily profit by multiplying the number of arbitrage situations by the profit from one arbitrage trade. Another thing that we recommend is setting your difference to open so that the value is several times greater than your difference to close; that way, the application will generate more arbitrage trades. For example, we can set the difference to open to, say, 17,000, and the difference to close to approximately 5,000. We recalculate. We get a smaller profit amount, so we can increase the difference to close a little bit. So now we get roughly the same profit amount, but the number of arbitrage trades will be higher.

 Max Spread

Max spread – we use this options (filter) to prevent order during high spread. You can check average spread on your exchange and set this parameter little bit higher. 

Good luck!

First of all, it’s worth bearing in mind that, when using arbitrage strategies, you periodically need to close your existing account and open a new one. How often should that be done? That depends on several factors. The first one is your trading preferences and purposes. Many traders leap into forex trading with the intention of striking it rich quickly. While arbitrage trading makes that possible, you have to realize that the bigger your monthly profits, the more unwelcome attention you can expect to get from your broker.

At this point, you might as well ask yourself if it won’t be easier to use non-arbitrage strategies, without having to worry about changing the broker or about caps on profits. That is certainly an option, but only arbitrage trading will deliver high profits with practically zero risk.

I receive many letters from traders seeking advice on what to do when a broker changes trading terms or conditions (for instance, by increasing slippage). At the same time, some of these traders have posted daily returns of 100% or more.

At the risk of being repetitive, I will reiterate that, the higher your profits, the more often you need to change your accounts. This is not a foolproof rule, but it will work most of the time. Monthly profits of 60% or more are bound to get your broker’s attention.

How do you find a new broker? Many traders don’t expend too much thought on it and simply come to us for recommendations. While we can certainly help with your broker selection, we also recommend that you look for one on your own: if you find a new broker for your arbitrage trading yourself, you won’t have to worry about hundreds of others arbitrage traders targeting the same broker, which should help you use that broker for longer periods than if you were to go with a broker we recommended to you.  

How do you go about testing?

First of all, you should use a VPS that is recommended by is, since our feeder is also located on the same VPS, which increases your chances of success. Many of our clients write to us to tell us that they want to use other VPS providers because they offer lower prices and broker pings as low as zero, etc.

I’d recommend the following. Do your testing on a recommended VPS and, if the results are positive (you’re profitable), you can move to your own VPS provider. You will save both time and money that way.

You don’t need to test all of your currencies. You can limit your testing to GBPUSD and EURUSD – this should be enough to determine whether the broker works or not.

Be sure to test on news and during “no-news” periods. Some brokers work better with trading the news; others work equally well with news and with no-news periods.

It’s important to understand that any links between accounts might give your game away to the broker.

Opening accounts through IB links is not a good idea, as it is very likely to cause your broker to change the trading conditions for one of your accounts, and then identify and flag all the others.

The use of PAMM is only feasible if you and your investors are ready to constantly change your brokers.

The worst thing you can do is ask a broker whether arbitrage trading is permitted, or to look for friends among employees of brokerage firms.

If you ask a broker about arbitrage, your name will be flagged before you even start trading. If a broker professes on its website to be tolerant of arbitrage strategies, it means the broker has advanced plugins that allow the broker to trade against you as soon as you start to make money. There are also unregulated brokers that try to take advantage of traders through such means.

You cannot have friends at a brokerage firm, even if you know these people outside of work. While this may sound a bit cynical, money is money, and your interests are not aligned with the broker’s interests. This applies to any other profitable strategy, not just arbitrage strategies.

Let’s say you’ve found a broker who works well with your arbitrage program. Now what?

A good idea is to make the broker a bit complacent. Start trading by using a couple of advisors, ideally unprofitable ones, before you get your arbitrage program to start working and making money for you.

My own strategy of monthly 30-40% returns makes it possible to trade through a broker – as long as I am using locking arbitrage, naturally. Once the account is flagged, I open an account under someone else’s name and resume trading. This can be a bit tricky but, once again, no other strategy is as profitable as an arbitrage one and no other strategy offers such low risk.

Finally, I’d like to address one frequently asked question about locking arbitrage – whether it’s possible to have two accounts, of which one is a real account and the other one a demo account. This question is natural when a user’s stats show profitability in both accounts. 

1. We do not recommend using any free VPS from brokerage company if you plan to win money. Broker will be able to login on VPS and check your strategy;
2. Never answer what kind of strategy do you use. The broker has no right to ask you about it. It is your right to use any strategies for trading. If the broker prohibits any kind of strategy - this is a b-book broker and stay away from him; The best answer: I use different strategy. I try new strategies every month. etc.
3. Do not answer do you plan to use, or already use, manual or automated trading strategy. The best answer: I will use (I use) both;
4. If you have profitable strategy and you want to manage 3d party accounts – it is bad idea to become an IB with broker, because broker will be able to understand the same trading pattern on all sub IB accounts and flag them;
5. If you use non regulated, but with a good reputation, broker – do not accumulate the profit on account. Withdrawal your profit  time to time.

Arbitrage trader should understand several very important sings:

1. Arbitrage is absolutely legal trading stile and it will be better to use regulated brokers and in this case your money will be safe;
2. You have good chance to make money for long time, if you use locking arbitrage strategy or hedge arbitrage strategy instead of latency arbitrage.

An illustration to the second point can serve as a screenshot from myfxbook

Duration of major trades higher the 1 hour. If you use standard Latency arbitrage strategy your trades duration will be <1s

and  profit  up to 125 pips (Data includes last 200 transactions based on the analysed history.)  If you use standard Latency arbitrage strategy your trades duration will be <2 pips

This style of trading can not be attributed to arbitrage and even scalping and is most like a grid trade.

1. It is also important to have good vps. We checked a lot of trading results and in 95% cases we helped to improve results by changing VPS.

We publich results from 3 Live  accounts

Account 1 vs Account 2

Account 3 vs Account 4

Account 5 vs Account 6

Good luck!

You can visit cryptocurrencies arbitrage calculator page and check current prices for most popular crypto currencies like: Bitcoin (BTC, Litecoin (LTC) Litecoin, Ethereum (ETH), Zcash (ZEC), Dash, Ripple (XRP), Monero (XMR) and other on most popular exchanges: bitfinex, kraken, gdax, bitstamp.

You can also evaluate arbitragepossibilities for hedge arbitrage or latency arbitrage. Feel free to contact us: support@iticsoftware.com if you have any questions.

Given the overwhelming amount of information that retail investors have to digest, it is certainly tempting to engage the services of a professional. But how sophisticated are these professionals? Are they truly experts? You can conduct a little experiment: try asking a number of analysts the same question, e.g., whether the Japanese yen will fall against gold or vice versa; and you will be unlikely to find a consensus. The truth is that there is a lot of money to be made in the financial industry, and quickly, which has the effect of attracting all sorts of individuals, including those who might not necessarily be qualified to be there.

Professional consultants employ many different strategies, but how suitable are these strategies for you? It is commonly held, for example, that margin trading is a high-risk strategy that is best to be avoided; it is more advisable to invest in other financial instruments such as mutual funds. Yet if you speak with a mutual fund specialist at a bank and analyze historical charts for the past couple of years, you will quickly realize that the drawdown can be as high as 20%, while the return on investment is typically about 8% per annum. You will also realize something else: that friendly mutual fund specialist is trying to sell you a package and his industry knowledge leaves much to be desired.

Conversely, when you trade on the forex and CFD markets and aim for an annual return of 8%, the probability of a 20 percent drawdown is practically nil. In truth, a more realistic objective is a monthly return of 40% with a risk level of 2-3%. If you’re starting small ($100-500), it is possible to increase your monthly profit by 100% by taking on more risk. When your investment capital is more sizeable ($10,000 and up), it is advisable to moderate your appetite for risk.

What strategies work best? Short-term scalping strategies are the most effective ones on the forex market. Strategies with least risk tend to be arbitrage ones; their risk is nearly 0%.

Why do arbitrage strategies involve low risk and high profitability?

The reason is very simple. Arbitrage strategies do not use indicators or rely on analyses of historical performance; instead, they utilize fast quotes received from the market and, as soon as the market moves sharply, orders are promptly opened in the direction of the sharp market move. It is almost as if the strategy were leaping ahead in time. Naturally, an arbitrage strategy has a more complex algorithm and an extremely elaborate code, but the idea behind arbitrage trading is simple: the strategy is trying to anticipate and take advantage of future price movement based on faster and better access to information.

How difficult is it to manage one’s own capital when trading, and what does it involve?

• It takes no more than a day or two to open an online trading account with a broker.
• You then need only acquire a fully automated strategy (a forex robot); recommended arbitrage strategy
• rent a server that will be active twenty-four hours a day, which will make it unnecessary to keep your computer on all the time (such a server can be rented for as low as $10 a month);
• and install the forex robot in your account – and that’s it!

What are the advantages of managing your own trading?

You determine your own risk levels and can stop trading whenever you want.

You do not have to pay an investment firm fees on an ongoing basis; you only have a one-time outlay of $300-600 when you buy the strategy.

You get to choose your own broker, which you can change at your discretion.

Nonfarm payrolls is an extremely important economic indicator in the US. This report is released at 08:30 EST on the first Friday of the month. Its release usually triggers a strong reaction on the forex market, which creates an opportunity to make money for the savvy trader.

As a rule, very few traders place orders before the report is released. During this time, the forex market is often characterized by false breakouts or movements in a tight band (typically, 30-70 pips). Opportunities to trade successfully arise when the report actually comes out.

The gist of the strategy is as follows:

1. It is necessary to place pending orders on the terminal approximately 5-10 minutes before the report is released. As the numbers, not to mention the market reaction, are difficult to predict, the trader needs to place the pending orders in two opposing directions (i.e., both buy and sell orders).

2. If you have open orders before the release of the report, it is best to close them because, even if you have placed a stop-loss order close to the price to hedge yourself, the market might open against your position with a gap, which might cause your stop-loss order to be closed at the market price (i.e., at the price at which the gap is opened) and not that of the stop-loss once the report is released. This might translate into a difference of 20-70 pips – a difference that might lead to a loss of your deposit.

To be sure, if the market opens on your side, you stand to make a good deal of money. This boils down to a 50-50 chance. It is up to you, though, whether you want to take that risk.

Typically, once the report comes out, the market tends to move in one direction, following which there is usually a strong reversal and a move in the opposite direction.

Therefore, to avoid an undesirable execution of your pending orders, it is advisable to place them about 35 pips away from the price level before the report is released (see Fig. 1).

Buy Stop Order (current price + 35 pips)

Time: 08:25 EST    

The orders have to be at least 50 pips away from each other

Sell Stop Order (current price - 35 pips)

Figure 1. Placing pending orders before nonfarm payrolls is released

3. The pending orders are placed. You now need to think about your stop-loss orders, which should be placed at a distance of 20-30 pips from the entry point into the market. Be sure to place the stop-loss orders at the same time that you place the pending order for the breakthrough – this is important in case your data center loses the connection or the price starts to behave unpredictably before or after the release.

For that purpose, we recommend the 1-point Trailing Stop (an advisor), which is ideal in this kind of situation. You can get it for free by subscribing to the Top 50 Forex Strategies website. The advisor has all the necessary functionalities for trading the news and has never let me down during my own trading activity.

How the trailing stop works

4. With respect to take-profits, I usually set them 70-100 pips from the entry point into the market.

Once the report comes out (08:30-08:31 EST), the price on the forex market will sharply move up or down.

Most likely, one of the pending orders placed above will be opened. If you see that you’ve made a profit greater than 25-30 pips, you have to move the stop-loss order into breakeven territory and cancel the second order (a trailing stop order will be of great help here, as it places instructions to move orders much faster than a human does).

You now have three choices:

• You can trail your order at a safe distance of 10-25 pips. The exact number depends on the currency pair you’ve selected and on market volatility – the higher the volatility, the smaller the size of the trailing stop and its movements.
• You can take a wait-and-see approach and monitor the price and how it reacts (in this case, it is essential to have already moved the order to breakeven).
• You can take part of the profit off the table (say, 50%) and leave the rest on the market.

5. About 20-25 minutes after the nonfarm payrolls report is released, it is necessary to determine the direction of the forex market.

If you haven’t taken your profits yet, this is the time to do it (08:45-09:05).

If one of the orders was opened and the price has been in limbo (it is said to be in limbo when there’s a movement in a 15-pip price band, but the price isn’t moving further), you would do well to close the position and take your profits, as a market reversal is in the cards.

A price that is in limbo is a telltale sign of a shift in trader sentiment.

See Figure 2.

The limbo period

Time: 09:33-09:55

Profits are taken

Getting ready to continue trading (08:45-09:05)

We have made a profit on the first order. We now need to determine how to proceed with our trading.

There are two options:

• Trade in the direction of the successful first order.
• Wait and monitor the price to see its direction and then follow it.

We work the orders the same way, by placing them in two opposite directions.

As soon as the order is closed, we place two pending orders: the first pending order is placed in the direction of the last closed trade (the breakthrough order has to be at a distance of 10 pips greater (lower) of the maximum (minimum) high (low) of the price after the nonfarm payrolls report (see Figure 3), while the second order should be placed based on the “50% principle”, i.e. 5 pips – in other words, if the market price crosses more than 50% of the rise (fall), it is highly probable that the price will return to the direction it took before the report was released. Figure 3:

Figure 3: Getting ready to continue trading

Buy stop (nonfarm payrolls high + 10 pips)

Your second trade (08:50-09:10)

After you have reentered the market with one of the pending orders you’ve placed, you can cancel the other one. It is just as necessary to move your stop-loss to breakeven in order to eliminate the risk of possible losses.

So, if you had an open pending order in the direction of the first open order, that is the direction of the price movement and is likely to last at least another 70-150 pips.

After the second market entry and the placing of the order, you might encounter another price limbo on the market (09:10-09:50).

Usually, a second price limbo recurrence is most likely to arise at the point of the first movement after the report release. Consequently, if you see a second limbo recurrence within 10-15 minutes, take your profits as quickly as possible.

The last entry into the market to trade the nonfarm payrolls reports (09:50-10:10) is possible at the breakthrough point of the market limbo.

It is unadvisable to open an order in the opposite direction because, if the market price returns to the first half of the swing after the news release, the market is indicating that neither bulls nor bears dominate the market, which will make it hard to move the price in the direction of least resistance at this time.

Pending orders are placed according to the same idea: the high or low +/- 10 pips (see Figure 4):

Figure 4: The final entry into the market

Your last opportunity to take profits is between 10:50 and 11:30 EST.

However, in my view, the ideal way to trade is use a 10-15-pip trailing stop and close the position with a stop-trade order (which is a positive stop-loss order).

You can consider your nonfarm payrolls trading strategy to have been successful if the cumulative profits from all of your nonfarm payrolls orders are 100-120 pips. However, there are times when the forex market gives you the opportunity to make a profit in excess of 150 pips. Be sure to take advantage of such an opportunity! 

The best software for news trading is NewsAutoTraderPro

First of all, we need to understand what latency is as a concept. In IT lingo, latency is the amount of time it takes for a computer command to be carried out. More precisely, it is the period of time between the input of a command and its execution. Expressed in milliseconds (a millisecond is a thousandth of a second), this is a term that is used widely in trading on the forex market, where it represents the amount of time that it takes for a broker’s server to communicate with a trader’s request.

Why it matters

When it comes to forex trading, latency is critical. Having an edge is essential to making money when trading currencies; to acquire an edge, time is of the essence. Low latency is conducive to profits, high to losses. High latency, for example, might cause slippage, which is the difference between the expected price of an order and the actual price at which the order is executed. This happens due to the gap between the time the order is placed and the time the broker executes it, during which the price might move against you. The higher the latency, the more time it takes for the order to be executed, the greater the likelihood that there will be slippage. While the price is unlikely to move considerably, even movements that are at a fraction of a pip add up over the long term, eating away at your profits and fattening those of your broker.

Another deleterious effect of higher latency is re-quotes and off-quotes, which can be a byproduct of slippage. A re-quote refers to the placement of an order at a price that is different from the one the trader requested; an off-quote refers to the broker’s failure to execute the order altogether – the trader is simply advised that the broker is unable to execute the order at the requested price.

Having low latency will protect the trader from these undesirable consequences of high latency.

You should also bear in mind that the frequency of the tick data flow might vary. It is hard to peg the tick data flow to a definite number; typically, an average of five ticks per second is registered. This translates into an average of one tick every 200 milliseconds. 

Traders and slippage – the numbers

• To avoid slippage, you need an execution time of about 4-5 milliseconds. That is the kind of latency that high-frequency traders have, which gives them an edge. You need to have FIX API Account and FIX API Trading Software.
• Professional traders with direct market access (DMA in industry parlance) enjoy an execution time of about 20-40 milliseconds, which typically also means zero slippage on orders.
• Advanced traders with direct market access have an execution time of about 100-120 milliseconds, which results in no slippage on the vast majority of trades.
• Advanced traders using the platform with a modified trading environment typically work with an average execution time of 200-250 milliseconds, which introduces slippage into trading.
•  Ordinary traders (for example, those who trade from home using a computer) face much higher average execution times, sometimes as high as 600+ milliseconds. They get the bad end of the deal. Slippage occurs with as much as 50% of all trades placed.

Ditching slippage

While the problem of latency is inevitable, latency itself can be lowered, which will mitigate its effects. 

Financial and other news drive financial markets, especially when there is a considerable divergence between expectations and results. When that happens, the market moves and prices change quickly to adjust to the new economic reality (the events are then said to be priced into the market). The time before the adjustment is complete is a time that allows astute and nimble traders to make money. Traders who engage in this kind of activity are said to be trading the news. I would like to introduce you to one of the most effective strategies to trade the news and join those traders who take advantage of these situations.

GETTING STARTED

Before you start trading the news, you need to know what kind of news you want to trade. To that end, you will need to compile a list of economic indicators that tend to have a significant effect on the forex market. I will share with you my own list of my preferred economic indicators. They are as follows

• Nonfarm payrolls
•  Retail sales
•  Inflation (consumer prices or producer prices)
• Unemployment
•  Industrial production
• Trade balance
• Manufacturing sector surveys

As the US happens to be the world’s largest economy, economic news reports from America tend to have the largest impact on financial markets, but this is not to downplay economic news reports from other countries, which present their own opportunities.

Once the list has been compiled, you need to choose your currency pairs. If you’re a beginner, pick one major pair. You will be able to choose more once you acquire experience and get more sophisticated. Make sure you home in on a single event at a time, though. 

We can now move on to the strategy itself. 

Step 1: Doing your homework

Once you’ve got your preferred economic events lined up, determine the release time and review expected numbers and forecasts. Prepare what is known as a trigger sheet, which is simply an Excel file that contains the event itself, the forecasts, and the trigger numbers that indicate the desirability of placing orders. You will need the trigger sheet when the news comes out.   

There are two ways in which you can estimate the deviation trigger:

• Using historical data to gauge past performance in similar situations
• Using the “20% Rule”. For example, if the actual number is worse than the anticipated one by 20%, you’d want to place a sell order for the currency in question. Conversely, if the actual number is better than the anticipated one by 20%, you’d want to place a buy order. 

Let’s translate these numbers into practical terms. Let’s suppose you trade the unemployment claims report. If the projected number if 325K, while the actual number is 390K, the difference is significant and the market will adjust to the actual number quickly, pricing in the difference. The difference is 20%, which offers a solid trading opportunity.

Step 2: Just before the release

Make sure you’re absolutely focused before the news comes out. You don’t want any distractions, so your environment has to be conducive to the ability to concentrate. This is the time to be single-minded. Clean up your trading terminal to get rid of anything nonessential to the task at hand. What you do want is to have your lot size set up and to be able to place an order with a single click on the chart. Remember that 95% of your success is entering the trade prepared.

Step 3: The actual trade

When the release comes out, expect a lot of volatility. If you’ve done your homework properly, you should be able to weather and profit from the storm. In any case, it is important that you be cool and in full control of your emotions. You also need to be disciplined: follow your trigger sheet religiously.

At this point, events can unfold in two ways:

1. The difference between expectations and results is not considerable, and your price does not reach any triggers. Stay dispassionate and resist the temptation to trade for the sake of trading. This event does not present a worthwhile trading opportunity.
2. One of the triggers is reached, and it’s time for action. Enter the market by placing an order according to the trigger that was hit. However meticulous you were in your preparation, do not neglect to use stop-loss and take-profit orders. I recommend a stop-loss level of 20 pips and a take-profit level of 60 pips. You might also want to convert your stop-loss order into a trailing stop-loss order.

PROFIT: SETTING THE RIGHT OBJECTIVES

Trading the news is a good way to make money: it is both effective and easy to use. Profits might vary, but expect a monthly return of 5-15% if you do it right. Risk levels are fairly low, since you trade only if the news report is favorable to your positions, but I advise you to start small in the beginning in order to acquire the confidence and discipline required to excel at trading.

USING THE RIGHT TOOLS 

There are tools out there that will help you hone your trading strategy. 

The most important future is “Algorithmic trading”. You can preset Stop Loss or trailing stop and take profit. You can move stop loss and take profit to breakeven level very fast – you just need to press one button. 

If you nor ready to analyze information, you can use Latency Arbitrage Strategy for news trading. You usually will have price movement on fast feed early then price movement on slow broker and in this case, you will be able to send order to market early and in fully automated mode. To avoid any problem, we recommend to use it with manual trading emulation add-on.

  I hope that you will put the information you’ve just read to good use. I’d also like to remind you that every strategy needs practice in order to be effective, so trading in a demo account is a good idea to get your feet wet before you move on to real trading. Professional software for the economic news trading

Happy trading!

The Financial Information eXchange (FIX) protocol is an international communications protocol for electronic trading. It has been developed in order to improve communication between market participants.

If you have a trading system or a robot that requires fast order execution (e.g., a scalping robot or a robot for trading the news), FIX API is the way to go. FIX API gives the trader access to real-time quotes and market depth as well as the ability to submit market and limit orders via protected communication channels.

The advantages of FIX API

• A high-speed connection and exceptionally small delays

For example, the execution of an order can be between 150 milliseconds and several seconds, but FIX API can bring that number down to as low as 4 milliseconds. We recommend that you install your trading systems on a VPS that is located in the same data center as that of the FIX API in order to minimize order execution delays.

• Direct access to deep liquidity and competitive pricing
• The ability to trade currencies, commodities and index funds

Be sure to request a complete symbol list from your broker before opening an account.

• FIX API can be integrated with practically any trading platform

Who can use FIX API to their advantage?

• Financial institutions that want to provide competitive pricing to their forex clients
• Brokers and companies that are interested in automating their forex exchange transactions and in foreign exchange hedging
• Hedge funds and investment managers looking for efficient order execution on the forex market

FIX API is also for:

• Traders with individual platforms and/or a need for an optimal communication environment. In our view, a switch to FIX trading will help the trader significantly improve trading results.

Using FIX API effectively

A considerable advantage of FIX API is the ability to use FOK or IOC orders, which allow the trader to be in complete control of slippage.

When choosing a FIX API broker, you need to evaluate the pros and cons of the broker with reference to the strategy that you’d like to use. For example, if order execution speed and an absence of rejects are essential to your strategy, you’d want to limit your search to brokers that do not have last look. Clients of such brokers trade on the forex market instantly via live streaming and receive the best execution prices with an immediate confirmation - in other words, trades are final and are confirmed as soon as they have been processed. As there are no dealing desks in the way, there are no re-quotes. However, it should be pointed out that brokers with no last look also have higher spreads, particularly when news comes out.

To help traders get profitable, we have developed an algorithm that allows the trader to circumvent any restrictions imposed by the trader’s broker and conceal an arbitrage trading strategy if one is used.

When the market is calm, the trader opens hedge orders in two accounts. By way of example, the trader opens a long position in EURUSD both in the first and second accounts. The accounts can be with the same broker or with different brokers. Of course, if the trader has both accounts with the same broker, the trader will need a second name. It might be a good idea to ask a friend or a relative to open an account with the broker for this purpose.

When an arbitrage situation arises, the trader closes one of the orders, thus creating something of a virtual order to which a trailing stop is applied. When the trailing stop is triggered, the order is reopened but, this time, in the other account.

What is achieved by using this algorithm?

• First, the broker sees that the orders have been open for an extended period of time, which means that any requirements to keep the order open for a minimum of 5-10 seconds have been met and the order cannot be canceled.
• Second, when the arbitrage situation arose, the trader did not have to open a new order, which made it impossible for the broker to identify it as an arbitrage order.
• Third, many brokers tend to close orders faster and with less slippage than they open them.

This algorithm has become an integral part of our locking arbitrage strategy.

At the present time, it happens to be one of the most effective and promising products on the market.

Lock Latency Arbitrage Strategy Algorithm Description

Lock Latency Arbitrage allows you to open 2 opposite (buy and sell) orders on 2 different accounts for each trading symbol. It can be two different brokers or two different accounts with the same broker. When arbitrage situation appear, software closes opened order on symbol, applies trailing stop for corresponding virtual order, and opens new locking order on the other side when S/L or T/P is hit. For example: 

Symbol: GBPUSD
Price on fast broker: Bid: 1.35005 Ask: 1.35006
Price on slow brokers A: Bid: 1.35010 Ask: 1.35011
Diff to open on slow Broker: 3
Opened order(s) on broker A on GBPUSD: SELL
Arbitrage situation is detected for long position. Instead to buy, we will close SELL order and apply trailing stop to virtual BUY order (ticket number of virtual order will be the same as for closed order, but opening price will be the price at which original order was closed); An when the stop loss is hit, we will reopen SELL order on broker b. So now on Broker

A we will have no orders on GBPUSD, and on Broker B we will have 2 orders – BUY and SELL. So now trading on GBPUSD will be performed only on broker B, and when long or short situation appears, one of the orders will be closed, and the other one will be locked on Broker A as the result of hidden S/L or (T/P).
This algorithm helps to solve two major problems:
-To increase the lifetime of the orders and thereby camouflage the arbitrage trading;
-Replace the orders opening by the orders closure, and thereby reduce the time of execution and therefore slippage.

1. VPS or dedicated server;
2. Cross-connections;
3. Broker and account type;
4. Type of arbitrage software

Let's dwell upon each of them.

VPS or dedicated server

We noticed that the trade performance is quite different even if traders use the same VPS location, the same account type (it means not only the same account name but the same server name as well), and the same settings. Some VPS providers declare that they are in the London equinix data center, but it is proving to be that they do not even in London (LD1-LD9). Usually brokers use LD4 and LD5

They are in cheaper datacenters in Ireland, France or Germany.  Not to mention the fact that many our clients, in spite of all our warnings and recommendations, are trying to install latency arbitrage software on home PC. And they do not hesitate to assert that the program does not work properly from PC located from thousands of kilometers from brokerage company and with ping =100-300ms.

It is very important what kind of internal network, network card, hypervisor or virtual machine monitor (VMM) your VPS provider have and how is your vps connected with your brokerage company. We use Ultrafx VPS and we can recommend their premium packages for arbitrage trading.  Feel free to contact me if you need discount coupon on 10%.

It is good idea to run test on demo account first. If software doesn’t work on demo account – you have a problem with your vps or settings.

Cross-connection

If you use 2 legs arbitrage and if  your broker is LMAX FIX API, it is very important to have cross-connected VPS and have unthrottled feed (100 updates per sec). It is also great advantage for all types of arbitrage trading if your VPS provider has fiber optic direct cross-connects with your  broker.

Broker and account types

Еhere is a perception that it is practically impossible to find a broker for latency arbitrage trading. This is not true. In the market, there is a huge number of brokers which have not undergone a large influx of latency arbitrage traders and therefore do not apply special anti-arbitrage methods.

A lot of broker make decision to change trading condition for trader after several trades and they do this manually. Some technologies allow broker to change this conditions only on weekend etc.

Also on the market there are always new brokerage companies are not “scared” by arbitrage traders.

Different accounts types, can have not only different trading conditions described on broker’s website: like spreads, commissions…, but also different execution time and slippage. Broker can provide different server for different regions (for example server-EU- Asia; server-EU…) and these servers can have different trading conditions as well.

A trader should understand that the broker is loss only if the trader's account in B -book (in house).

Based on the above trader should build its strategy.

If broker true ECN/STP/DMA (but it is bad idea to make any conclusions based on information from broker’s website. Very often brokers use “STP”, “ECN”, “DMA” works only for advertising), and there is not much competition (usually it is good to use local small and not so popular brokers), the most important to be faster then others. It means you should have fastest feed and fasters VPS. The best software for this strategy is Latency Arbitrage Software.

If brokerage strategy to change trading conditions if trader use latency arbitrage strategy, the best way is camouflage trades:

-use another EAs together with arbitrage;

-use Locking arbitrage strategy or Hedge arbitrage Strategy. 

Type of arbitrage software

Еhere are many types and varieties of arbitrage trading: latency arbitrage strategy (one leg), lock arbitrage strategy, hedge arbitrage strategy, triangle arbitrage… We described all pros and cons in our previous articles, but I would like to explain two major  advantages of locking latency arbitrage.This type of algorithm helps to solve two major problems:

-To increase the lifetime of the orders and thereby camouflage the arbitrage trading;

-Replace the orders opening by the orders closure, and thereby reduce the time of execution and therefore slippage.

Good luck!

Although the trader needs to understand that he is facing a number of problems when using latency arbitrage. Like any profitable strategy, arbitrage is an unwanted strategy for forex brokers, especially if the dealer makes a mistake and switches an account into B-book, and in this case loses money.

Brokers use a variety of methods to make arbitrage strategy unprofitable. The simplest of these is the introduction of additional delay, or slippage. if a trader uses pending orders, the broker can not execute them to explain the lack of liquidity.

After receiving feedback from a large group of traders, who use our Latency Arbitrage Software, we can see that about 52% of them still manage to make money on a consistent basis, and another 33% earn but not always. You must agree that this is a great statistic compared to the general statistics of the forex market, where 95% of traders lose their money. 

What is the difference between traders who are successful and are not successful   in the use of arbitrage strategies?

1. they do not ask and do not disclose the operating brokers, and check trading conditions themselves and thus do not create a huge toxic flow for this broker, forcing him to use anti-arbitrage plug-ins;
2. before using the latency arbitrage software, they study all possibilities and subtleties;
3. they trade only several of the best symbols for each broker;
4. they offer some new ideas.

Probably what I have written above should be clear to every trader - to be successful you need to make an effort. However, it should be clear and not only for traders.  If you mow the lawn and have not learned how the mower works, you are likely to slice your feet. :-)

Based on the wishes and recommendations of successful traders over the past few months, we have made a few additional options and add-ons. 

New feeders 

First of all we have added new symbols (according to our and our clients opinion, it is better to trade exotic currencies, and indexes, and CFDs) and new feeders based on traders feedback and now I can say with confidence that we broadcast the fastest feed from live accounts via FIX API, that will satisfy all your needs for arbitrage trading.  5 feeders are available now from 4 different sources

 Latency Arbitrage Free Feeders

Feeder # 1 (location London, UK)
Available symbols: EURUSD, GBPUSD, EURJPY, AUDUSD, USDCAD, USDCHF, USDJPY, NZDUSD, UK100, WS30, SPX, NDX, GDAXI, FCHI, STOXX50E, J225, AUS200, HSI, SPN35, XAUUSD, XTIUSD, XBRUSD.

Feeder # 2 (location London, UK)
 Available symbols: AUDUSD, EURUSD, EURJPY, GBPUSD, NZDUSD, USDJPY, USDCHF, USDCAD, XAUUSD, EURNOK, USDNOK, EURSEK, USDSEK, EURTRY, USDTRY, EURMXN, USDMXN

Feeder # 3 (Location London, UK)
Available symbols: EURUSD, AUDUSD, GBPUSD, NZDUSD, USDCAD, USDCHF, USDJPY
Feeder # 4 (Location NY, US)
Available symbols: EURUSD, GBPUSD, USDJPY, EURJPY, AUDUSD, USDCHF, NZDUSD, USDCAD, XAUUSD, EURNOK, USDNOK, EURSEK, USDSEK, EURTRY, USDTRY, EURMXN, USDMXN, GDAXI

Feeder # 5 (Location NY, US)
Available symbols: EURUSD, AUDUSD, GBPUSD, NZDUSD, USDCAD, USDCHF, USDJPY

New Options

1. “Connect on startup” - this option allows you to autoconect to broker when you start software. It is very useful if your server (vps) reboots for some reason (this option is free with standard license)
2. “Allowed direction” –  you can adjust software to only buy, or only sell orders. This option is very useful if you trade indexes or CFDs. (this option is free with standard license)
3. “Handmode emulation” – this option allows you to emulate manual trading instead of EAs (automated) trading. It is very useful if your broker doesn’t allow automated trading. (for an extra fee) learn more...
   
4. “Offset autocalculation” – this options allows you to trade CFDs and Indexes, because there is a constant price difference for CFDs and Indexes on fast feed and on slow broker. (this option is free with standard license)
5. “NAlgo”  new trading algorithm. This algorithm helps to avoid broker intervention (slippage). (for extra fee). It was developed based on our and our clients experience. Software places pending orders (limit and stop orders) only based on innovate trading algorithms. This software tests brokers and places the right type of order. You can adjust distance between price and pending order and pending orders life time.  (for extra fee) learn more...
   

Currently, we see several ways to improve the arbitrage trading and among them is the use of new non-standard algorithms with the possibility to control slippage, and for this reason we have created NAlgo and CTrader Arbitrage.

Good luck!

Reviews

When you are searching for the best EA, reviews made by others who are using or have used the program are a great place to start. They can tell you many things about the software’s performance, some of its strengths and weaknesses, and if you look hard enough, what kind of formula or solution the EA has. By using the experiences of previous or current users, you can find out about how the Expert Advisor manages money, like what its drawdown rate is or if it has a stop loss, among many other things. Reviews are the best place to start looking for the best program for you.

Try It Out

Even after reading reviews, you don’t always know exactly how a EA will function under your specific circumstances. In this situation, it is helpful to have a demo account where you can run the software to see how it does with no loss to your investment. Any Expert Advisor you are thinking about adding to your live account should be run through a demo account first for at least three months. Each month you can review the program’s performance, but even if there is a really bad month that shows plenty of losses, you have to think more about the long-term. If after three months, the program has done very well, you probably have the best EA for you.

Trying to wade through the masses of expert advisors with all of their different options can be tough, especially when people can so easily program their own. However, if you are willing to read through some reviews and have the patience to run a long-term test on it, you can find the right EA to suit your needs.

What does a fledgling Forex trader search for on the Internet?

Lots will be looking up 'forex strategies' aiming to get hold of a profitable and easy to use trading system. Fans of technical analysis will type 'Forex indicators' or maybe 'Forex rates' in the search bar. Less experienced traders, who want to automate their trade, will search for 'Forex expert advisors', and a trader who's tired of endless flows of news and charts will ask Google to find 'Forex video'.

But who is doing the right things and who is getting it wrong? And what is the most useful tool for successful trading?

We can find out now. Traders that are early on in their careers will be aware of some of the forex market phraseology but not know so much that can have definite opinions or views.

He will have a 30 - 40% likelihood of being familiar with aspects of forex possibly having completed some forex courses that will give him a little theory and maybe some practice.
So he looks to practice his new Forex knowledge using a cent account. He knows a little about some forex strategies and some forex courses but not much of this is used when trading. He's heard or even tried to work with Forex expert advisors on demo accounts, but he doesn't know how to test these advisors on the historical data in the strategy tester.
The novice trader either actively places 10-20 popular Forex indicators on the EUR/USD chart or just trades without using these indicators pinning his hopes on intuition and candle analysis.And he's seen some forex videos which is a little more interesting than staring at price movement charts.

So from all of these methods and tools, which ones make a professional trader?
Honestly? They all are!

But what is the difference between a professional trader, who earns regularly huge sums of money every month or even every day and a trader who is just starting out and would be glad to make 20 points of profit? Deposit size? Not really. Knowledge? Wrong. Years of practice? Nearly....

What separates these two types of trader is the very successful one will not only ACCUMULATE RELEVANT KNOWLEDGE but also BECOME ENGROSSED BY THE MARKET.  A real trader learns to feel the market. He can't see not ever trading or not being involved in the market. This isn't about gambling addiction; that really isn't the case. The top traders have genuine belief that they will succeed and back themselves to do so. He is committed to his target and ignores obstacles. Any minor failures, sadness at losses or even losing deposits are not dwelled upon but viewed as minor lumps on the path.However the beginner loses interest straight away. He isn't ready to wait and needs immediate results.

He has read about a forex strategy he hasn't tried, works with it for a few days, it doesn't succeed so he drops it and tries a new one looking for the holy grail. But there is no Holy Grail and there won't be one either. So why does he choose not to scrutinize the matter and his chosen forex strategy?

 Why not review the failure reasons and find some common reasons? Quite simply, because he has no patience and no persistence. So why do we use forex strategies? You need them to find the appropriate trading algorithm, to choose 'your own' Forex strategy, to learn something new and use it when you trade. It doesn't even have to be a total algorithm. The seasoned trader will use a maximum of two strategies for trading to make the real profit. On the other hand, a beginner changes Forex strategies like underwear, never persisting with anything long term. By taking such a shallow approach how can they ever hope to develop a detailed trading scheme when all that he does is glimpse at the product description? Trader-programmers developed Forex expert advisors (robots) to simplify the life of traders, who trade manually. So what do novice traders do? They adjust the forex expert advisor to trade for them using their last bit of money they have.

The more experienced professional trader will instead test the forex expert advisor using the strategy tester set to a 1 - 2 year period, examine the results, try out the robot with demo accounts, and then meticulously go through its trading approach. At this point, fully understanding the way the forex expert advisor works and choosing the appropriate robot he can then get the forex expert advisor working on a live account.

Quite a difference!

Almost all traders - about 99% - used forex indicators. But some traders simply overload a chart with indicators, making it almost impossible to conduct analysis. Others place 2-3 Forex indicators and follow a certain pattern of work with them. The benefits of a forex indicator are its ability to provide buy/sell signals and provide confirmations. But if there are too many indicators, they will only send signals that will confuse a trader. Put some candles onto a chart and also insert a couple of moving averages - fast using a period of 5 or 10 and slow with 50 - 100. However using exponential moving averages would be preferable. The last X prices are taken into account with moving averages thus minimizing lagging.

And then you can always optionally add 1-2 Forex indicators. The main thing is not to complicate it. Let's take a look at Forex video on the internet. What could be more convenient than to watch and think about what you've seen on the screen? But a lot of people will randomly download information which they will never look at and all it does is fill up their hard drive. Alternatively, there are those that will seek out videos from the 'guru' selecting the forex videos they are interested in.

To only use actual forex video is important.

For example, if someone is learning about fractal analysis they should get the associated forex video and make sure the sound is good and the video is of decent quality and then apply their learning immediately. If you don't use it straight away you will forget. Or if you have read about Alexander Elder and the trading system with triple screens, getting a forex video or forex strategies should be used to help reinforce the learning.

But don't stop there. You can open up a trading terminal and put what you have learned into practice. You will spend the day profitably and learn new information. Think how much you could make in a year! You deposit will grow like mushrooms before you know it!

In summary.

If you have a desire to learn about how to trade profitably but are not keen on hearing from a range of assorted gurus from the cradle to the grave...
If you like numbers, charts and Forex indicators, enjoy watching Forex videos and studying new Forex strategies....

If you have patience and persistence... If financial freedom is something you are attracted to....
If so, then you simply must achieve your goal! You only need discipline and determination.

Good luck on this journey of challenge - The journey that all of the professional forex traders have already taken!

Scalping strategy can be applied manually or automatically.  Manual scalping forces the trader to sit in front of the computer to monitor signals and executing trades. In automated scalping the trader creates a computer program that can monitor signals and interpret them. The automated scalper is often referred to a Forex Scalping Expert Advisor. The good thing about scalping robot ea is that the trader does not have to monitor the market the whole day.  The scalping robot ea will do this on his behalf and trade as it was told to.

There are three main benefits of scalping, which are:

·         Small trades can be made more frequently than large ones. Even if there isn’t much activity in the market, the scalping strategy can take advantage of the small movements and make profit.

·         Small movements are easily obtainable.  In a steady market bigger movements can be difficult.  For instance, it is easy for currencies make 10 cents movements than $2 movements.

·         Small trades decrease exposure to risks. Because the scalper will enter the market briefly, chances of running into volatile events are slim.

·         Scalpers need a single positive signal to enter the market while position traders need a lot of time to prepare and make market analysis.

 Two Scalping Styles

·         Primary Style-The scalper using this style will use the one-minute time frame to make five to hundreds of trades. Instant execution of trades is crucial; hence a Forex scalping ea can be more beneficial.

·         Supplementary Style-Scalping can be used supplementary to other trading time frames.  Most traders tend to scalp only when the market does not have longer frame trends. Traders will then opt to exploit the small movements in the market.

The beneficial thing about using scalping is that you can make many trades at a short space of time with lesser risks. Forex Scalping is compared to picking a lot of loose change. Scalping can be profitable particularly when the primary style is applied. If you choose to go for automated scalping, ensure that you get the best scalping ea to avoid costly interruptions.

Forex Scalping Robots

Past Performance

What’s the history of the EA? Does it have a fairly good past performance or a bad one? Is it strong with only one currency pair or is it mediocre with several? Here is where expert advisor reviews really help answer these questions. Generally, it’s not good for an EA to try the same solution or formula for all currency pairs because what’s good for one isn’t good for the other.

Money Management

What was the maximum drawdown within a certain period of time? Does the EA use a stop loss? A program has a good maximum drawdown if it’s below 30% during a given period. If the EA doesn’t have a stop loss and has accuracy below 80%, especially if it is a buy expert advisor, it would be very unwise to go with that program.

Risk

What kind of risks can you stand to make? Could the risks outweigh the gains? Ultimately, you decide how much of a risk you are willing to take with any trade, trading system, or expert advisor. Some risks have a very big payoff. Many risks end up losing investors a large amount of money. To minimize your risk, you could always test an EA in a demo account to see how it works and if it will do a good job. If the EA does well in the demo account for over three months and is able to sustain a fair profit with minimal losses, then it might be time to use it in a live account.

If you stick with these questions, you are likely to find an expert advisor that does fairly well. Any program with a high success rate, is good at money management, and has been thoroughly tested is a good EA to start with.

When making any type of choice we have to have the ability to determine, in addition to rate things based upon a range of varied requirement. Whether it is determining in between exactly what kind of vehicle to purchase, or something as easy as which kind of sweet to obtain from a vending machinery, there are eventually a magnitude of elements influencing our choices. These stats are an extremely prominent consider any choice making procedure. Which dish will provide the most fulfillment for the price? Or which TELEVISION will provide the greatest quality image and resolution? Like these instances, a range of variables could be weighed when selecting a Specialist Consultant to trade with. Throughout this 2 part report, we will spotlight the measurable elements that impact our choice. The stats and treatments we have actually decided to concentrate upon are a few of the vital variables that need to be used prior to lastly trading and selecting with a particular EA.
 

Comprehending the Data

Cold hard quantitative statistics are pertinent and really crucial figures, that you'll should research throughout the course of picking a trading robotic. As you could envision hundreds of pictures exist to determine danger and efficiency however there are simply a handful of measures that are extensive and must regularly be considered. When properly examining a trading robotic, it is extremely crucial to keep one's threat tolerance in mind. We will reveal various instances, in addition to the numerical stats that will information how traders might evaluate a Professional Consultant. Remember that it is similarly essential that you use your specific threat hunger and choices when determining which EA is the very best suitable for you. Although these are not the only analytical measures you might decide to see, overlooking any of them could possibly lead you to miss out on an important facet of an EA, and eventually negatively influence your trading.
 

Earnings Measure

The objective of trading is to expand and produce wide range. Although this is a all natural and extremely simplified method to consider an intricate task, such as trading, eventually it is the reason all trades are made. With this in mind, the initial aspect you have to use is "Will this EA produce unfavorable or favorable returns?". Although it is impossible to anticipate the future, particularly in trading, one useful method is to forecast making use of historic information. Remembering that historic outcomes do not suggest future efficiency, it makes extremely little sense to select an EA with a losing record. Undoubtedly you will wish to select a lucrative EA. Nevertheless simply choosing a rewarding expert advisor will do you no great. You will have to contrast it with various other lucrative EAs, and for that reason productivity has to be quantified. Among the very best measures that we have actually discovered is referred to as the success element. This picture is an easy computation that not just reveals whether you could anticipate a adverse or favorable return on your capital, however likewise takes into account an essential danger aspect which we will discuss soon. The earnings aspect is the ratio of the amount of you could anticipate to acquire for each dollar put in over the amount of you go to threat to lose. The picture is computed as: (revenue - commission) / (maximum drawdown + commission). Any EA with a worth less than 1 represents a historically inadequate EA where returns do not exceed losses and danger. For all extensive functions you will constantly wish to get rid of any EA that has a productivity element of less than one.
 

Comprehending the Drawdowns

When picking an EA, the drawdown of an EA is one of the most essential danger indications. Drawdown is the portion the EA loses from its peak to trough, or the last peak to its next reduced. Since of the info it represents about possible drops in worth and the general volatility of the EA, the reason it is such a vital fact is. The preliminary drawdown analysis ought to be done aesthetically by analyzing the equity curve of the EA. Huge choppy motions are a measure of an EA with high volatility and a considerable quantity of drawdowns, which could frequently be fairly extreme. An instance of one EA may appear like so:.

On the various other hand, a hassle-free constant equity curve is a depiction of an EA with less volatility and typically lower and smaller sized drawdowns.

 Although your preliminary analysis will be with aesthetic evaluation of the equity curve chart, more quantifying this info to a set measure could be incredibly helpful; specifically when contrasting 2 comparable EAs. The 3 vital measures handling drawdowns are; maximum drawdown, typical drawdown, and drawdown recovery. The initial, maximum drawdown, is the very best sign for a worst case circumstance analysis, and is essential in choosing whether one can swallow the possible threat connected with the certain EA. Like the name signifies, maximum drawdown is the biggest drawdown in portion terms that the EA has actually sustained over its life time. From a reasonably conservative technique, it is sensible to presume that this maximum drawdown takes place virtually instantly after moneying your account. By doing this you could examine whether you would feel comfy with this possible danger. If not, it would most likely be finest if you selected an alternative EA. In the next report we will advance with our analysis of drawdowns in addition to concentrate on the data connected with trading efficiency. 

If you have started online foreign exchange trading, or would like to, but need a little help making decisions on what to trade or analyzing your trades, you can use Expert Advisors (EAs) to help you. These aren’t people like you may be thinking. These are actually pieces of software or programs that you can download and use in your trading platforms to help you get the most out of your investments.

What do these programs do?

EAs are actually very flexible pieces of software that can do just about anything you want them to do. Sometimes, they can simply advise a trader on which trades to make or not to make. At other times, a trader can program an EA to actually analyze past trades, try to predict future patterns, and execute live trades on the platform. Expert Advisors are available on a wide variety of platforms, including 4, or . EAs usually calculate different indicators and use these indicators to assess market conditions, according to its design. They also usually have three different parts, including a startup (init function), a main function, and a clean-up function (deinit) at the end. As it runs, an EA will usually cycle through its main function until the program is ended. Usually, there are certain questions embedded in the code of an EA that the program cycles through and answers in a way.

The first thing it is normally programmed to do is determine the amount of equity in the trading account and if there is enough to start a trade. If there is not, then the EA closes without going a step further. The questions it then asks and answers, after determining whether it can trade or not, depends on what the trader wants. Some can determine which trades are open and close them, or analyze which trades it should make next. Each piece of software can be as different as the traders themselves.

How do I find one?

Usually, an online trading platform will probably have a list of EAs you can download and use with their program. and others have a simple option to either import an EA from a creator or create your own, specifically tailored to your needs. EAs can then be attached to a chart for technical analysis or to automate certain trades. If you decide to create your own, usually the program is written in Language 4 (programming language for ), and you would need to brush up on this programming language in order to ensure your EA will function correctly.

Expert Advisors

What You Should Know About Forex Indicators

Just like the market itself, Forex indicators are very unpredictable. Indicators have different functions.  The trend indicators are used to measure the price trends. Volume indicators distinguish between weak and strong movement. The momentum indicator shows the price data by sellers and purchasers.

Traders use indicators to analyze present and pat price information so that they can be able to make accurate predictions of price movements. Traders can also create their own indicators. In traders can create custom indicators, and set them up and launch them.   Indicators can also by traders who prefer long term investments to

The programming language for programming language is used to create indicator.  Once created, the indicator can be used to trade manually or develop Forex trading strategies.

How to Identify the Best Indicator

Finding the best indicator depends on your ambitions as a trader. You can get them for free or purchase one which can be expensive.  As already mentioned above you can create your own indicator. The best indicator is the one you can use with ease, and that can provide accurate signals of the right time to buy or sell. There are different indicators that professionals use which are:

·         Trend following indicator-Profit is made by following a particular trend and trading in its direction. This indicator will tell you if the currency you want to trade is up or down. The disadvantageous things about trend following is that it can be easily whipsawed.

·         Trend Confirmation Indicator-This tool confirms whether the identified direction is not false. A profitable situation is when the trend following and confirmation indicators are in agreement.

·         Oversold or Overbought Indicator-This tool helps you determine whether to buy into weakness or strength. Some traders would decide not to buy even when the trading currency is showing strength.  This is because sometimes buying into weakness offers lower risks.

All creators of the indicators claim that their system is the best.  You should take time to learn about the indicators above and others not mentioned hereso that you can make an independent decision.  Some indicator tools may make profit for one trader but not work best for another.

Best Indicator- How to Find It?

Professional Expert Advisors

Parabolic SAR

Parabolic SAR is a standard indicator of the 4 trading terminal.

Parabolic SAR Trading Signals

If the price chart crosses over best forex trading indicator lines, it “reverses” and the following values will be situated on the opposite side of price. In this case the starting point will be maximal or minimal prices for the previous period. Parabolic SAR best indicator reverse is a signal about ending of the trend or its reverse.

Parabolic SAR is a good forex indicator and it is capable of finding entry and exit points. It is better to close buying positions when price falls below the line of the forex technical indicator, and it is better to close selling positions when price rises above the Parabolic SAR indicator line.

This forex trading indicator can also be used as a trailing stop line.

In a buying position is opened (price is above the Parabolic SAR line), the indicator line will move upwards irrespective of price movement.
 

Parabolic SAR Calculation Formula

For Buy Position:

SAR (i) = ACCELERATION * (HIGH (i — 1) — SAR (i — 1)) + SAR (i — 1).

For Short Position:

SAR (i) = ACCELERATION * (LOW (i — 1) — SAR (i — 1)) — SAR (i — 1),

- SAR (i — 1) — the value of best indicator on the previous bar;
 - ACCELERATION — acceleration factor;
 - HIGH (i — 1) — maximal price for the previous period;
 - LOW (i — 1) — minimal price for the previous period.
 

Moving Average of Oscillator (OsMA) Indicator

Moving Average of Oscillator or simply OsMA is a technical Forex indicator that shows general difference between Oscillator and its smoothing. In this concrete case the basic MACD line is an Oscillator, and the signal line of the same trading indicator is used as smoothing.

Moving Average of Oscillator (OsMA) is a good forex indicator for the 4 trading terminal.

OsMA Trading Signals

Two OsMa Oscillator signals are used to trade on the foreign exchange market:

•    Change of tendencies – growth becomes fall and vice versa;
•    OsMa divergence with the price chart.
 

OsMA Calculation Formula

OSMA = MACD-SIGNAL,
- MACD – showings of the MACD main line;
 - SIGNAL – the MACD signal line.

Click to read about OsMA Divergence Indicator

Click to find Forex Software (Arbitrage, DDE, Copiers ->, - )

Although about the last one I'm not sure. If you do not have 1 million, very small chance that in a month you will have 1.5.

So what to expect from trading on the forex market. The most easy way is buy fully automated trading system, I mean expert advisor, or  couple of them and start trading immediately.  But if expert advisor's developer claims that you will gain 300% per month, it's the same nonsense. Professional expert advisor should earn about 50 -100% per year with maximal drawdown 20-25%. For this reason if you would like to invest in forex 10 000 you will receive 15000 within 1 year.

You can increase your gain if you use money managment: Lot size = percent by account balance, but risk will be higher. If you use several Expert advisors on several currencies, it will reduce risk and increase profit , provided that all expert advisors are professional.

Couple recommendations:

• Never buy expert advisor from one-page website with painted statements.
• Never use expert advisor on real account without forward testing on demo.
• If you choise based on back test, bactest should be for period 2 years or more, drawdown about 10-15% (if EA trades with 10% from account balance)
• EA should trade with SL and TP.

Expert advisors use for profit is not only novice  but experienced traders, skillfully organizing portfolio of expert advisors. As for beginners, for many traders expert  advisor - it's just an indispensable tool of work and cure of many ills. Even if the novice trader has already attained all trade secrets, in order to comply with its own rules of operation is not enough to have some knowledge, should still have not less important skills, which primarily include discipline and strong nerves.

Of course, does not mean that it is enough to simply purchase ea and start gain money.  All this is not so. It is necessary to have an idea about  forex market, how it works, what factors influence the behavior of currency quotes, how to work with the terminal (if you are going to use trading robots, or should be using the strategy tester and optimizer). But if you've already learned about forex and , it certainly will be able to fully enjoy the benefits of expert advisor and that it is prepared to provide to you!
 

Recommendations for working with any forex robot

• Before using a trading robot to learn at least the basics of the forex market, do not try to invest "blindly"
• Learn what's inside the terminal , how to use the strategy tester
• Never overload your deposit. I can recommend lot size = 2-5% from balance
• Any expert advisors  requires two things - communication and uninterrupted power supply.
• If you have doubts about the reliability of your computer, as the power supply and Internet connection, it is best to use the dedicate server or VPS. (It's not so expensive)
• I recommend to save EA settings in to the .set file (experts/presets/) and load them.
• Test expert advisor time to time and compare backtest with trade results (forwar test). It will help you to find deficiencies in the strategy.
• Withdrawal profit  from your trading account.

Buy professional expert advisor

MTF Stochastic indicator that we are going to examine in this article consists of four stochastic best custom indicators MTF (multi time frame), situated in a single sub window. We will review a combination Н4-Н1-М30-М15, though you can use any number and on any timeframe.

Stochastic indicator combines both functions of a trend indicator and oscillator. An Н4 line (the black one) and an Н1 line (the red one) act as trend indicators on senior timeframes.

Opening of a long position on the basis of indicator signals occurs when Н4 and Н1 lines grow. The most advantageous moment is when both lines start growing from under the level “20”. Buy trades are also valid until reaching the oversold zone by these lines (above “80”). Entry is also possible when the Н4 line “lies” in the oversold zone, and the H1 line slightly deviates from a trend or “sags”.


Market buy entry is carried out when:

1.    The above-mentioned conditions are met;
2.    The lines М15 and/or M30 begin the movement to leave the oversold zone.

As you can see on the second picture, good signals of indicator appear when the Н1 line slightly deviates from the main trend (for example, not lower than 50), and the lines М15 and М30 start moving upwards together.


In you use the best forex trading indicator on M15, it would be better to place short positions, about 20 points. Longer positions appear only when a larger stochastic (for example, M30 or H1) has “sagged” against the trend (H4).

Forex technical indicator Williams’ Percent Range (%R) (Oscillator)

Williams’ Percent Range (%R) is a dynamic indicator (oscillator) that detects overbought or oversold conditions of assets. %R largely resembles Stochastic, but it uses an inverted scale, and Stochastic relies on inner smoothing. It is a standard best forex trading indicator of the 4 trading terminal.

Working zones of %R indicator

The oversold zone of Williams’ Percent Range is between the values -80% and -100%. Accordingly, the overbought zone is between the values -0% and -20%. Values of this indicator have negative sign for building on an inverted scale. Minus doesn’t influence analysis at all.

The use of %R

As well as at use of other best custom indicators that signal about overbought or oversold condition of the market, it is reasonable to rely on Williams’ Percent Range data only after price reverse in the corresponding direction.

The Williams’ Percent Range indicator has a useful feature: it points to forthcoming price reversals in advance. As a rule, %R forms a peak and reverses downwards shortly before the price reaches the high and starts sliding down. In case of the reverse upwards everything happens in the same way: %R starts rising in advance.

%R Formula

%R = (HIGH(i-n)-CLOSE)/(HIGH(i-n)-LOW(i-n))*100,

 - CLOSE — today’s close price;
 - HIGH(i-n) — the highest maximum for the last n periods;
 - LOW(i-n) — the lowest minimum for the last n periods.

Find Indicator according your needs

Forex Software page

Essence of the Stochastic Oscillator

There's no point delving into the detail of the Stochastic formula here. You can find this information in the background information of the 4 trading terminal. Even if you don't have this terminal you can still download it free of charge. You can obtain some useful information here so it's worth a read. You can compare the workings of the Stochastic Oscillator to that of a pendulum. It swings and changes with each price impulse. The stronger the market movement is the higher the oscillation amplitude is. At the end of the impulse (the push) the pendulum slows. It will then reverse and move back. As a rule, a correction occurs on the market at this time. Then the whole cycle repeats. All these movements strongly resemble a pendulum that swings from the center to edges. The features of the Stochastic Oscillator are that it has a center of 50 and edges of 100 and 0.

Formation of a Classical Overbought Stochastic Indicator Signal

1. When the Stochastic Oscillator reaches its extreme value, you can expect the reverse. We can consider extreme values as 20 and 80.
2. With the red (fast) line and blue (slow) line of the Stochastic Oscillator being crossed immediately prior to the indicator reverse the price will go with it. But it's rarely mentioned that you should wait for this reverse. Only when both the fast and the slow lines of the Stochastic Oscillator have reversed, can you consider the reverse to be reliable and confirmed. You should then close the bar that formed the reverse.
3. When the bar that confirms the reverse of the slow line has closed, a position can be opened after it.
4.  If the reverse takes place in the area of 20, a buy signal has been received
5. If the reverse takes place in the area of 80, a sell signal has been received

The Most Important Overbought Stochastic Indicator Signals ' Divergences

Divergences or convergences are the most important overbought stochastic indicator signals. This is simple and shouldn't frighten you. A divergence is when peaks or lows diverge with price peaks and lows.

Bullish Divergence

This will happen upon a new price low not being confirmed by a new indicator low. The red lines on the picture show the divergence. When the bulls take up the running, we see a significant correction that lasted month and a half.

Bearish Divergence

It is clearly seen on the picture how this long correction ended because of a bearish divergence. There is a continuation of a down trend.

Reverse Divergence

There is also such a thing as reverse divergence. Textbooks rarely cover this. That aside, this is a firm signal that there is a continuity to the trend. It is easy to recognize it. A trend can be seen in the picture. There is the formation of a small correction. Simultaneously, there is a large movement by the Stochastic Oscillator and once the maximum value of 80 is reached, the previous peak is exceeded. This will be the start of a strong and swift trend. Reverse divergence can also feature bullish and bearish. The bearish reverse divergence is shown on the picture. If a new price low on the ascending market is higher than the previous one and a new Stochastic Oscillator low is lower than the previous one, we will see the bullish reverse divergence

Short Divergence

Where there is a divergence on indicator peaks and price, this is a short divergence.

As a rule, this type of divergence indicates a change of mood and at the least leads to a strong correction and even trend change. Yet, this signal is weaker than the previously mentioned divergence types. Normally, short divergences are classical divergences (bearish, bullish) but using a smaller timeframe.

Hidden Divergence 

Overbought indicators of a hidden divergence will not show any divergence! I.e. the is confirmation of a price peak by an indicator peak. But you can't compare their sizes. To give an example, price impulses are significant however even with the indicator peak showing as higher than the one earlier, it does not look significant in comparison to price peaks.

Reminder

You can only rely on a Stochastic Oscillator signal when it has been confirmed. I.e., the bar that forms the reverse should be closed. It is also important to take into account that it is inadmissible to use only the signals of the Stochastic Oscillator. The signals of at least two signals should be used to confirm its signals. You could other types of overbought indicators like Momentum, OsMa, RSI or MACD. The indicators are standard in 4.

Advice #1

You will have a correct prediction probability of around 60% - 70% from formed and confirmed divergences. Once the divergence has been formed on the border of a triangle or significant channel level, this likelihood increases to 75% - 80%.

Advice #2

A position can be exited using the reverse divergence. For instance, the bullish divergence on the trend that is descending. We have a useful method that we developed that we want to share with you. It is for a correct exit from a position on a divergence. It's an important moment and a question that's often asked. Miss it and you could lose your profit or even make a loss. The market should be entered on a triple divergence upon the border of figure and use the double divergence with no levels to exit. The rules of exit:: The levels of the previous peak are overcome by price on the chart.. At the same time, indicators are still below the level of the previous peak. A classical bearish divergence will occur if the price goes down. Chart peaks won't confirm the peak of the price so the correct price behavior can be predicted. Be ready to exit and prepare stops. Should no reverse occur and the existing bar closes and the divergence is disabled, you should put the stops back and continue with your trades.

Conclusion

Overbought Stochastic indicator signals are very valuable and quite accurate. But confirmation is needed and a significant level.

Good luck with your profits!

Forex Volume Indicator

You don’t have to download or buy this indicator as the developers of 4 took care of everything. The Forex Volume Indicator is integrated into the platform so the only thing you need to do is turn it on. If you don’t have the 4 trading terminal, it is highly recommended to download and install it.

Installation of the Forex Volume Indicator to the Terminal Desktop

If you know how to do it, you can skip this part. Installing the Forex Volume Indicator is very simple. Right-click on the chart and select ‘Volumes’ or press Ctrl+L. Follow the instructions to install the full-scale indicator. Find the button ‘Indicators’ in the upper menu of the terminal. Select ‘Volumes’ - > ‘Volumes’ in the drop-down menu. 
You can adjust the colors and thickness of the lines yourself in properties of the indicator. To do it, right-click on the indicator and select ‘Volumes properties…’.  That’s it for installation and adjustments!

Why do Many Traders Neglect the Forex Volume Indicator?

In fact, the Forex volume indicator doesn’t show a real trade volume, i.e. it doesn’t show the direct amount of money coming into the market. There are no indicators capable of meeting this challenge, because Forex is an over-the-counter market, so it is impossible to track the real volume of incoming funds. That is why many traders believe the Forex volume indicator doesn’t show the real money flow, so don’t use it.

The essence of the Forex Volume Indicator

The indicator shows tick volume. What does this mean? It means that it counts the number of ticks performed during the formation of a candle.

Why is it Important to Take into Account Tick Volume? 

All traders know that the endless fight between the bears and the bulls (the sellers and the buyers) takes place on the market all the time. A price chart shows who’s currently winning and losing.  If price moves up, it means that the bulls are stronger and vice versa. Tick volume illustrates the intensity of this fight. It shows whether a trend is in full play or if traders are taking no interest in it. Are the bulls much stronger right now or not? Should you buy hoping for further growth? Maybe the bears are regrouping ahead of a new rush or there are no bears on the market at all right now. As you can see, the simplest Forex volume indicator can give you vital information about market composition and its psychological structure.

The Forex Volume Indicator in Monetary Terms

For convenience, we can look at the financial aspect of the Forex volume indicator. Bear in mind that several hundred million dollars (and even several billion dollars) are spent per tick. Multiply the number of ticks by value of their performance and – presto! – Now we know the volume of incoming funds! But you won’t notice a big difference because there is no difference. Ticks are performed for money. It is abundantly clear. We see the number of ticks in the indicator, i.e., as a matter of fact, the Forex volume indicator shows the amount of money coming into the market but the indicator does it in the form of ticks.

How to Interpret Signals of the Forex Volume Indicator 

Let’s be clear on this point: don’t use small timeframes (less than H1) to analyze tick volumes. There is too much market noise on these timeframes. Moreover, it is quite difficult to determine the true state of things using such short periods of time. Bigger timeframes (H1, H4, D, W) allow the Forex volume indicator to collect more accurate information. Let’s examine the signals of the Forex volume indicator and learn to read them. These signals can be used to analyze specific candles as well as analyzing general market movement.

Candles

Look at the picture below. One small bar in the middle of the picture is marked by a small blue checkmark. The greatest signal from the Forex volume indicator corresponds to this bar. Why? As a rule, the biggest candles have the greatest volumes.

Uncertain Market

Such phenomena can occur on a very uncertain market. Great volumes tell us about the strongest fight between the bulls and the bears. Nevertheless, the forces are equal and the price stands still. This is the most dangerous moment to enter the market as it is so uncertain who would win. The price could start moving rapidly upwards or downwards at any moment so it’s best to abstain from entering. It’s like tossing a coin – hit or miss, win or lose.

Connection of Bars

Now look at the next white bar. It is very small, too. You can see that its volume decreased a little and the market raised a little. It points to the fact that some bears left the market. They might be getting ready for the next fierce fight or are just waiting for the result of the fight to enter the market more easily. Let’s see what happened next.

The Bulls Retreat

The bulls had spent their potential on the white bar and understood that resistance required too much money. The next longer black bar tells us that the bulls retreated and only the bears remained on the market. Volumes are almost minimal. There is no movement. It means that there is no resistance from the bulls’ side. The following three small bars (one white and two black ones) are small encounters. The bears continue pursuing their own line and their number gradually grows. You can see it thanks to the growing volumes. And price slowly moves downwards.

The Bulls Give Up

The bulls are finally exhausted. It is obvious that there are fewer bulls than bears and they have to waste a lot of money to support the open positions. But it’s all in vain. The bulls understand that they’ve lost and they retreat. At the same time, the bears strike a new blow to the market. We see a long black bar which is the ‘win’ of the bears. They’ve earned quite a lot of money and are pleased with themselves. Volumes decrease and movement slows down on the next candle. It is a very interesting story, like a siege of a fortress. The bulls have lost. Try to read the market by yourself. Open your trading terminal and train a bit. If you don’t have one, you can always download it for free. For starters, select a random area and analyze the course of a trade. Then you can read the current price and determine what’s going on in the market right now.
 

Volumes in movement

If you see a swift decrease in volumes on the market, you can say it’s almost certain that the interest in this movement is slackening. Most likely, it would stop and a correction, a flat or a reverse would start. You can then start preparing to exit the market. Look at the picture above and the bars marked with red rectangles. Volumes decrease after the long bar (marked with checkmarks). The supporters of this movement exit the market and only the most loyal ones stay. Then a flat starts.

Divergence

You can see divergences of three different oscillators and also a strong decrease in volume. Then an inevitable market reverse occurs. If you analyze the market and see that there is a divergence on the movement – it’s bad. It means that the movement could end. And if there is a decrease in volume it is the end. A correction or a reverse is almost inevitable. The Forex volume indicator is good confirmation of this. Of course, other oscillators should also confirm the signal of your oscillator. In short, if you see this situation – put your best foot forward and run!

Conclusion

The Forex volume indicator is quite interesting although many traders are skeptical. Now you know that you don’t need to be. The Forex volume indicator is unique in terms of the degree of its usefulness. Not many indicators can boast such objective information. It is recommended to include the Forex volume indicator to your trading strategy. It would be a useful and helpful addition.

Click to read about Forex Volume Divergence Indicator with Hidden Divergence

Have a nice profit!

Learn more about Indicators

Indicator shows 3 good signals on chart.
But if will switch off, for example, MACD Indicator,

we will receive several false signals.

Super divergence indicators work better than standard divergence indicators on any market conditions. For this reason it is easier to create good trading strategy, using super divergence indicator.  Our company has developed Free Tool – Divergence Constructor. This tool allows you to combine several any divergence indicator and find the best one for your currency / timeframe. 

Divergence Constructor – Download for free

We recommend to combine indicators from different groups. I mean indicators from different categories.  
We have found combination for eurusd: ForceIndex + OnBalanceVolume + ChaikinMoneyFlow Div and this super divergence indicator works with high accuracy on USDCAD, AUDUSD, GBPUSD

!!! Click to View Super Divergence Indicators Offer !!!

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Definition of 'Relative Strength Index - RSI'

A technical momentum indicator that compares the magnitude of recent gains to recent losses in an attempt to determine overbought and oversold conditions of an asset. It is calculated using the following formula:

RSI = 100 - 100/(1 + RS*)   

Definition of 'Commodity Channel Index - CCI'

An oscillator used in technical analysis to help determine when an investment vehicle has been overbought and oversold.


    

Definition of 'Stochastic Oscillator'

A technical momentum indicator that compares a security's closing price to its price range over a given time period. The oscillator's sensitivity to market movements can be reduced by adjusting the time period or by taking a moving average of the result.

We have found this combination of divergence indicators using the free tool divergence constructor. And we have coded super divergence indicator RSI-CCI-Stoch based on this combination of indicators. Indicator works good on timeframes: M15, H1. And can be used for all currencies.

Super Divergence Indicator Explanation

Divrgence Constructor Explanation

Related materials:

Free Divergence Constructor

Super Divergence Indicators

Tools for Scalping

Linear Regression

Using a statistical technique, the so-called least-squares method, linear regression builds a line that ideally corresponds to the series of data points with the least deviation. Linear regression tries to predict future prices using continuation of this line. Then the regression channel can be built by means of placing lines above and below the central line with the use of standard deviation. Fortunately, modern traders do not have to be experts of statistic analysis to do this operation, because the majority of graphic programs can build lines and channels of linear regression automatically. In the given article we will use a channel of linear regression as the basic trend scalping forex indicator.
 

Read more about profesions channel indicator

Tick

Tick is a market indicator that shows the last price and, thereby, shows interaction between demand and supply on the market. In the given article we will use tick as our main forex scalping indicator of market mood.

Stochastic

Then we use stochastic as the impulse scalping forex indicator. However we will substitute tick for price in calculations. While tick is a very valuable measurement of an instant buying against selling, observation of bare values is a difficult task, and even building it on 1-minute and 5-minute charts sometimes makes it difficult for reading because of fast movement of values in a spiral between extremes. Using Stochastic based on tick allows us to understand market mood as an impulse is increasing or decreasing. We will use Stochastic based on tick to approve that the impulse is moving towards us when we enter the market.

Find more information about Forex Scalping here: http://iticsoftware.com/scalping-forex

I am not accidentally said professional. Professional is expert and specialized knowledge in field which one is practicing professionally. (wikipedia definition). For more than 10 years our company has been offering ready to use products for forex market and expert advisor programming service.  Our programmers and mathematicians have highest level of education and experience. And we are able to create professional forex robots and indicators. 

Remember that the error in coding can lead to losses in your account. We will provide you with “clean” programming language for code and the basic logic of the robot will be divided into functions. Our professional robots never lose control and easily restore its last state after restart. We are not afraid of developing complex and integrated forex robots and find it interesting. We can suggest new ideas or see the obvious errors in your description. We will also recommend additional extra features for your robot to make it more profitable.  

But if you do not have good forex strategy, you can buy expert advisor for platform on our expert advisors page. I can recommend you to buy expert advisor TFOT. Expert Advisor TFOT is professional fully automated trading system, based on two independent   forex strategies. We have programmed this robot about 3 years ago and started testing 2 years ago on our real account (10 000). Profit for 2 years period was 350 %. learn more about forex robot TFOT

What action can you take to stop this occurring?

It's best for the dealer to first understand the sort of indicator they are using.

Here the main categories of indicator:

1st  indicator - Trend indicators

- There are three major movements in price this will show when dealing in Forex.
Up, Down and Sideways
These indicators can aid your search for the major price movement direction as it will smooth out the price info across a particular period of time.
Or put another way, these types of indicator will allow traders to get a visual perspective on the trends in the market.

2nd indicator - Volume indicators

These will be used to specify the degree of interest the investor has in the market. You can see that a new trend is likely to emerge if there is a high volume near important levels in the market, as opposed to the lesser volumes reporting that traders have doubts and are disinterested in that market.
When trading Forex, the volume data means the total quote activity over a particular period in time.

3rd indicator - Momentum indicators

When trading Forex, this reports the pace at which prices move throughout a specific time frame.
In the same time period, this indicator will also be tracking the strength of a certain trend ; momentum highs take place when a trend starts and ends when it troughs.

4th indicator - Volatility indicators.

This shows just how big the price oscillations are. Periods of more increased volatility (high intensity) and more decreased volatility (low intensity) will be features of all markets. These instances are wave like: a period of higher volatility will at some point give way to lower intensity and by the same token, sooner or later, the lower volatility will be taken over by higher intensity. So the intensity of fluctuations in price will give a more detailed look at market activity by these indicators.

5th indicator - Cycle indicators

If you have a pattern that continually repeats itself you will have a market cycle. Events such as day counts, seasons changing and any theories about the inner workings of the market will be what influences these patterns. It is better for traders to hold back from using any indicators within the same category. You will find that you can easily spot the indicators from the same category.
Putting a selection of indicators in a chart, the similar indicators will start to demonstrate all the same behaviours. The signals they provide will match the identical increases and decreases. For instance, momentum indicator, ultimate oscillator and RIS are from the same camp so will produce similar results. So, with this in mind, it's best just to work out which one of these you want and don't use the others. If you follow this fairly straightforward approach for picking your indicators, your thinking will be up there with the most experienced Forex dealers.

Click to find indictors according your needs: http://iticsoftware.com/-indicators

Awesome Oscillators - some examples

An awesome oscillator

This awesome oscillator will evaluate the margin that exists between current prices and the historical ones. The Rate of Change will increase as the price trends also rise and also declines when a downward trend occurs. The ROC's relative change will be affected by the size of the price changes.
It would be wise to pay close attention to this awesome oscillator if you want to know when a market is about to change. A current trend may stay as it is for a while even once an oversold or overbought signal has altered.
Using previous trends of this awesome oscillator it's quite normal to foresee price changes by applying them to today's market. The bar and bull markets are what creates the resistance and this creates the wave- style of the prices.
High ROC values tend to indicate an overbought stock. As an overbought or oversold market may continue in this fashion for a while, to wait for the market to move down or up may not be for the best.

MFI - yet another awesome oscillator

Lookig at another awesome oscillator, the Money Flow Index is one awesome oscillator that is calculated over a specific period of time and uses a zero to 100 range. This will show the flow of money of days that increase as a percentage of the up and down days From the view of technical analysis, taking the average of the high of the day plus the low of the day and the price at close will give the typical price. Divide this by 3 and multiply by the volume will give the money flow. Multiplied by the volume of the day gives us the money flow. Over a time frame, these totals can give a range over certain days that a typical price exceeds is a positive money flow and below is seen as a negative money flow. To get a money ratio, the positive money flow is divided by the negative money flow. The money flow percentage will be derived from the following: 100 x positive money flow / (positive + negative money flow).
This awesome oscillator has now yielded a money flow gauge that states any value over 80% means overbought but beneath 20% is oversold.
It should be pointed out that money flow is only the total dollar value of shared that have been traded and buying enthusiasm is an 'up' day and enthusiasm to sell is a 'down' day.
A reverse in price will be created if there is too extreme a move in either direction.

RSI - another awesome oscillator

The purpose of this is to map the existing and previous weak or strong points of a security market using a fairly recent trading day and the closing prices. Classed as one of the momentum oscillators, this is an awesome oscillator that will follow the speed and size of the price movement direction. This is an awesome oscillator that can work out the degree in between lower and higher close prices for the momentum.Securities showing weaker changes will not have as large a RSI as those with stronger changes.
Using a range of 0 to 100, this awesome oscillator will normally be used over a 14 day time period and 'highs' are classed as 70 and 'lows' as 30.

The Bottom Line

It becomes noticeable that these tools start to look similar. Using them in combination will become handy for knowing when to leave or join a trade. Professional traders use these awesome oscillators which is probably why they seem ahead of the game when buying and selling stocks.

CCI Indicator - what does it measure?

The CCI indicator will assess how much a stock can vary from the statistical mean. By measuring the gap from the typical price and simple moving average of a stock, this can be calculated. To take this further, we then divide this by the typical price's mean absolute deviation. So that the majority of the CCI Indicator values will fall into the -100 to +100 range Lambert set a constant of 0.015. It will then oscillate higher and lower than zero. The proportion of the CCI indicators within the +100 to -100 range will be decided by the number of periods used. The smaller the period the more volatile the CCI indicators and less in number will be within the +100 to -100 range. Likewise, use a larger time frame for calculating the CCI indicator and there will be a larger ratio of values that are within the +100 to - 100 range.Both general investors and traders will use the CCI indicator to search for price reversals in addition to the strength of trends and price extremes.Like a lot of these instruments, the CCI indicator can be combined with more analysis tools. As an oscillator indicator of momentum, it fits into one of the categories that can affect a technical assessment along with volume indicators and price charts.

The CCI indicator is not dissimilar to Bollinger Bands in that it can be used for spotting any deviations away from a price trend, working as an indicator of oversold or overbought situations. The more usual fluctuations of the CCI indicator will happen within the scope of the -100 to +100 and will usually vary above and below a line at zero.
Overbought values are ones that are higher than +100 and oversold values are less that -100. In keeping with alternative indicators of this type, when an oversold or overbought situation occurs, it's likely that price will adjust itself in time.

Increasingly, investors are finding CCI indicators attractive. Traders will use these to guide their trending cycles for commodities, stocks and currencies.
By adapting CCI indicators to work with other instruments, they can form a helpful tool to pick out the likely peaks and dips of a price that may then offer a solid foundation for making further forecasts about how prices might move. The CCI indicator has the bulk of its values in the 70 to 80 percent range of the +100 to -100 area and as such only 20 to 30 percent alert to a buy or sell. It follows that once the CCI indicators goes in excess of +100, a stock can be said to be moving into a trend that is strong and upward and a signal is made to buy.
But once this returns to underneath +100, this situation should be shut. Likewise, with the CCI indicator under -100, a stock will be trending downwards with strength and a sell signal emerges.
The CCI indicator is very flexible and can help in spotting price reverses.

Bottom Line

The CCI indicator is now a popular tool with technical investors,no doubt due to the ability to reveal trends in equities, commodities and currencies.
Mixing it with oscillators, the instrument can locate the high and low points of a price and possibly forecast how they might change in future.

What does a fledgling Forex trader search for on the Internet?

Lots will be looking up 'forex strategies' aiming to get hold of a profitable and easy to use trading system. Fans of technical analysis will type 'Forex indicators' or maybe 'Forex rates' in the search bar. Less experienced traders, who want to automate their trade, will search for 'Forex expert advisors', and a trader who's tired of endless flows of news and charts will ask Google to find 'Forex video'.

But who is doing the right things and who is getting it wrong? And what is the most useful tool for successful trading?

We can find out now. Traders that are early on in their careers will be aware of some of the forex market phraseology but not know so much that can have definite opinions or views.

He will have a 30 - 40% likelihood of being familiar with aspects of forex possibly having completed some forex courses that will give him a little theory and maybe some practice.
So he looks to practice his new Forex knowledge using a cent account. He knows a little about some forex strategies and some forex courses but not much of this is used when trading. He's heard or even tried to work with Forex expert advisors on demo accounts, but he doesn't know how to test these advisors on the historical data in the strategy tester.
The novice trader either actively places 10-20 popular Forex indicators on the EUR/USD chart or just trades without using these indicators pinning his hopes on intuition and candle analysis.And he's seen some forex videos which is a little more interesting than staring at price movement charts.

So from all of these methods and tools, which ones make a professional trader?
Honestly? They all are!

But what is the difference between a professional trader, who earns regularly huge sums of money every month or even every day and a trader who is just starting out and would be glad to make 20 points of profit? Deposit size? Not really. Knowledge? Wrong. Years of practice? Nearly....

What separates these two types of trader is the very successful one will not only ACCUMULATE RELEVANT KNOWLEDGE but also BECOME ENGROSSED BY THE MARKET.  A real trader learns to feel the market. He can't see not ever trading or not being involved in the market. This isn't about gambling addiction; that really isn't the case. The top traders have genuine belief that they will succeed and back themselves to do so. He is committed to his target and ignores obstacles. Any minor failures, sadness at losses or even losing deposits are not dwelled upon but viewed as minor lumps on the path.However the beginner loses interest straight away. He isn't ready to wait and needs immediate results.

He has read about a forex strategy he hasn't tried, works with it for a few days, it doesn't succeed so he drops it and tries a new one looking for the holy grail. But there is no Holy Grail and there won't be one either. So why does he choose not to scrutinize the matter and his chosen forex strategy?

 Why not review the failure reasons and find some common reasons? Quite simply, because he has no patience and no persistence. So why do we use forex strategies? You need them to find the appropriate trading algorithm, to choose 'your own' Forex strategy, to learn something new and use it when you trade. It doesn't even have to be a total algorithm. The seasoned trader will use a maximum of two strategies for trading to make the real profit. On the other hand, a beginner changes Forex strategies like underwear, never persisting with anything long term. By taking such a shallow approach how can they ever hope to develop a detailed trading scheme when all that he does is glimpse at the product description? Trader-programmers developed Forex expert advisors (robots) to simplify the life of traders, who trade manually. So what do novice traders do? They adjust the forex expert advisor to trade for them using their last bit of money they have.

The more experienced professional trader will instead test the forex expert advisor using the strategy tester set to a 1 - 2 year period, examine the results, try out the robot with demo accounts, and then meticulously go through its trading approach. At this point, fully understanding the way the forex expert advisor works and choosing the appropriate robot he can then get the forex expert advisor working on a live account.

Quite a difference!

Almost all traders - about 99% - used forex indicators. But some traders simply overload a chart with indicators, making it almost impossible to conduct analysis. Others place 2-3 Forex indicators and follow a certain pattern of work with them. The benefits of a forex indicator are its ability to provide buy/sell signals and provide confirmations. But if there are too many indicators, they will only send signals that will confuse a trader. Put some candles onto a chart and also insert a couple of moving averages - fast using a period of 5 or 10 and slow with 50 - 100. However using exponential moving averages would be preferable. The last X prices are taken into account with moving averages thus minimizing lagging.

And then you can always optionally add 1-2 Forex indicators. The main thing is not to complicate it. Let's take a look at Forex video on the internet. What could be more convenient than to watch and think about what you've seen on the screen? But a lot of people will randomly download information which they will never look at and all it does is fill up their hard drive. Alternatively, there are those that will seek out videos from the 'guru' selecting the forex videos they are interested in.

To only use actual forex video is important.

For example, if someone is learning about fractal analysis they should get the associated forex video and make sure the sound is good and the video is of decent quality and then apply their learning immediately. If you don't use it straight away you will forget. Or if you have read about Alexander Elder and the trading system with triple screens, getting a forex video or forex strategies should be used to help reinforce the learning.

But don't stop there. You can open up a trading terminal and put what you have learned into practice. You will spend the day profitably and learn new information. Think how much you could make in a year! You deposit will grow like mushrooms before you know it!

In summary.

If you have a desire to learn about how to trade profitably but are not keen on hearing from a range of assorted gurus from the cradle to the grave...
If you like numbers, charts and Forex indicators, enjoy watching Forex videos and studying new Forex strategies....

If you have patience and persistence... If financial freedom is something you are attracted to....
If so, then you simply must achieve your goal! You only need discipline and determination.

Good luck on this journey of challenge - The journey that all of the professional forex traders have already taken!

Description of the Forex Trading Strategy

You can enter the market using the Bollinger indicators that can be found on all trading platforms, including the 4. Buy stop and sell stop orders can be placed at 20 pips above and below the horizontal channel borders when the Bollinger indicator shows parallel lines. You can use any timeframe.Prior to placing any orders that are pending you should perform some technical analysis on the higher timeframes. For instance, look at D1 before placing any orders on H1. Were the price to be next to the upper channel border using the day timeframe, we place only the Buy stop (and the opposite for Sell stop). You can place a stop-loss at 20 points beneath the channel border opposite.

Transaction Support According to the Trading Strategy

When a pending order has been initiated there are two possible scenarios.

A) The transaction has no profit or it has a profit that closes on a stop-loss because it has not reached 25 points. Here, once there is trend reversal, the sell stop order has been placed using the same principle as buy order previously. I.e. a long transaction closes on stop loss and a short position is then immediately opened. This will also have these same two scenarios.

B) The opened transaction brings an immediate profit. Once the 25 point barrier has passed, the transaction moves to break-even. Should price continue to go in the right direction, trailing stop is used.

When opening up further positions, pending orders are placed 20 points above the maximums using the 4-hour chart. You can place orders after the summary stop for all of the positions that are in a positive area or break even position. Because of the volatility of the forex market this is a safety reason. Another variant would be the movement of an open transaction at break-even when the 25 point mark is achieved. When the stop loss of trailing stop is hit, this is when you take your profit. And finally, it is vital to have a clear and thorough strategy for trading when trading forex due to the complexity of the market.

A Description of a Simple Forex Scalping Strategy

Trading with this strategy is simple as long as you follow these three rules:

* The H1, M30, M15 and M5 timeframes can be used to check the candles
* If all four timeframes are showing white candles then you can open up a buy transaction
* You should open up a sell transaction only if all of the 4 timeframes have black candles

We can take a look at a sample of using the forex strategy below:

Using the Simple Forex Scalping Strategy

This forex trading strategy can used once the 4 trading terminal has been prepared. The same currency will need to have four windows made for it (see picture). Select 'Window' and then 'Tile Vertically' to arrange the chart. Following the preparation, you can open up the transaction after waiting for the signal.

This transaction opening process can be described in detail:

* Looking at the picture will show you that the candle that had opened at 3:00 on the H1 timeframe was black when it was closed
* Now we see that at 3:30 on the M30 timeframe a candle was opened and it was also black when it closed
* On the M15 timeframe, the candle that had been opened at 3:45 was also black upon closure
* Lastly, the candle that was opened on the M5 timeframe at 3:55 was black

As the conditions for trading with this forex strategy were met, market price can be used to open up buy transactions. Of this is only an example; but should H1 and M30 show candles that are black while M15 has a white candle, you should not proceed with this transaction. These rules should always be followed if you want to ensure successful trades. This applies not just to this strategy but all forex trading strategies will be profitable if you follow rules.

Rules when Placing Take-Profit and Stop-loss

Placing take-profit and stop-loss for this forex strategy has only two rules:

* 15- 20 points is where the stop-loss is fixed. Here you should be getting a minimum of 30-40 pips profit. As soon as the price gets to +15 pips, the transaction transfers to break-even or half the position is closed. Like a lot of other forex strategies, this simple forex strategy uses trailing stop.
* A stop loss can also be placed below (above) the close minimum (maximum). Here the take-profit is 2-3 times the protecting stop order. The profit is fixed in the same way as previous

The advantages and disadvantages of scalping

Fundamentally, when you scalp, you only use small timeframes and make a lot of trades within a day to make lots of little profits - just a few pips. Position traders will have to undertake a lot of market analysis and preparation before starting a trade whereas a scalper just uses a single signal before they enter the market. He makes his profit and gets out just a few seconds later. What's more a position trader will keep their position open for many hours or days but scalpers will only have their positions left open for a few minutes, sometime seconds. Where this changes is that this will happen many time throughout a day. Scalping forex is known as being like picking up loose change but a lot of it. Although position traders will seek out the one big profit, a scalper goes for lots of smaller profits. Amazingly, scalpers will frequently see their profits exceed that of the position trader over the same term and would normally expect to pull in between 5% and 10% in a trading day.
 

So what are the advantages of scalping?

I believe that the benefits of being a scalper far outweigh the disadvantages and as such it is a more profitable and appealing choice than position trading. I would say that the specific benefits are:

1. You have larger profits than a position trader would.
2. You don't have to wait for a strong trend to start - it's just not relevant with this strategy
3. It becomes pointless trying t to analyse or forecast the market.
4. At the end of each trading day I can close up all of my open positions, take my profit and leave without having to concern myself about what the market is doing or worry whether the market will turn against me/
.

But what are the disadvantages of scalping?

Just like all trading systems, scalping has its disadvantages. These are quite serious so you need to pay attention:

1. When you scalp for 4 hours, you will find that your trading can be very tiring.
2. There is no room for error with scalping. You need to be able to analyse and understand a situation at once and make cold, calculated decisions immediately.

On this point, there is a significant difference between position trading and scalping.
From a risk management position, position traders will not use up more than 10% of their capital when they are conducting trades. This is not applicable with scalping and 50% or more can be used. And when you are scalping you need to be constantly monitoring how the market is reacting, make snap decisions before leaving the market. And not make any mistakes.

So what are the main indicators for entering the market?

Scalping's main issue is the ability to identify the support and resistance levels which forms the basis for the whole system of trading. From my time trading this way, I have noticed that the currencies will rebound from resistance and support levels. This won't always be by a lot and sometimes it's quite small but it's enough to make some money. But you might be wondering how this is different from position trading as defining the support and resistance levels is what position traders need to do as well?.There are lots of differences. Traders will need to build in a 2 point minimum when they define their support and resistance levels and trend channel to build a strong level while at the same time using a minimum 1 hour timeframe. The best indicator to determine trend channels is the LR-Channels Indicator.

Scalpers can ignore this because as long as they have a trading level that uses a 1 minute timeframe they can work without large bounces as they only need one point to make a profit. As the market continues to change, bringing a break in trends that means losses to some traders; the scalper takes the small profits.

Quickly identifying the required support and resistance levels is a big factor when scalping. BJF support resistance levels indicator is what I would recommend here.

Our next subject to look at is:

Support and resistance levels

It's important to remember the following: With scalping strategies, you must be precise in defining the correct level of resistance and support and on differing timeframes from one minute to one hour as opposed to following the more classic method of technical analysis. A 5M timeframe has been used here and it's clear to see that the level of support has been formed.

A timeframe of 5M has been used here and the resistance levels have formed. With both of these two diagrams, it's clear to see where the higher and lower levels have been formed. We do not need to be bothered by the fact that there is a 5M timeframe just that the levels of the timeframe have been defined and there is hardly any difference. If a larger timeframe is used then there is a direct correlation to the amount of money used to come into the market. We look at this more later. What we need to work out is how do you accurately define the support and resistance level? Our earlier graphs provide the most common depiction and any scalper will be interested in this.These next images are just like the same picture but slightly longer.

We can see that the pair of currencies did return to the support and resistance levels and then rebounded. So how is money made? Money is made by buying or selling as the support and resistance levels are approached. Referring to the resistance level diagram, it's clear that the currency is in contact with the level of resistance and then rebounds from it over the short term. Two sales could have been achieved here.

So how are the levels defined?

We now know that we must define support and resistance levels when scalping. And here is where I can give my thoughts on the methods used to define them. At the price where the bounce could go to either one side or the other is where the level is set. The direction of the next bounce has a 90% probability according to technical analysis. Here is an appropriate juncture to make another comparison between position trading and scalping. Position traders look for those instances where the price bounces by a minimum of 100 pips in the required direction - not 20 to 30 pips. But bounces of this size don't happen as often as the 90% probability of a 20 pip price jump; that will then return to the level and jump back up by another 15 pips and may then have a poor bounce or go straight through the level. The goal of every scalper is to gather up each of these bounces and put them into their account. We can determine the levels further still by looking at the criteria across a number of timeframes yet their definitions will stay the same.
 
Defining of 30M and 1H levels

I believe that trading with the 30M and 1H is best and you use the lowest and highest points on the diagram to do so. We will find that currencies will frequently hang in between these points therefore we need resistance and support lines drawn in order to wait for the currency pairs to make a move to one level or the other. It can appear as though the currency pair is trapped and not able to find a way out from this position and would eventually go up or down. But if the currency is over the highest point or below the lowest point you just need to mark it and wait until the currency pair approaches it.

Defining of levels on 1M 5M

The levels of 1M and 5M trade are marked differently. In this situation, the lowest and the highest points that are obtained within 3-4 hours are marked and the levels of trade are then stated at that point and any trade operations will be processed once these levels are reached.

Entry rules

With the 1M and 5M, you buy or sell when trade levels are reached according to if the price is nearing either the resistance or support lines. But this is different for the 30M and 1H.

This is because these have more powerful levels and are viewed by more people meaning more will be entering the market prior to the price nearing the current levels so the bounce comes too soon. So I will trade despite prices not approaching the current level and often I will close with between 5 to 20 pips of profit. There might be times when the price hits the level indicated and this is where I would open up a new position using a double lot.These images will show that the prices do not reach the level that is marked on 14 pips.

Volume of market entry

Just like when we define the trade levels, the entry volume needs to be considered when we scalp. You do need to know this but it's not complicated. It's clear that the greater the volume when entering the market, the greater the amount of profit per pip. But we cannot overlook the issues that at every unprofitable deal will make us a loss.
So we know that scalping can make for big profits and losses and needs a different approach to capital management.Obviously everyone wants to maximise their profits and minimise losses so we should come into the market with big volumes once we are clear there will be big bounces.

We be confident that 30M and 1H will tell us this and this is summarised as:

With a larger time frame comes a bigger volume and a smaller timeframe a smaller volume. We are concerned with obtaining definite figures; specific volumes within specific timeframes.

I would use these volumes in my trades if my deposit was 5K. The 1M and 5m deals would get between 10% to 20% 20% - 50% of the deposit will be used in the deals on the 30M, 1H

So what if the currency pair does not go our way?

Scalping has high risks and as such you can't relax. A position trader could take the hit of a loss but a scalper can't as the volume he trades with is a lot bigger and should a losing position remain open longer than necessary, big losses can result. A good rule to remember is to close any position with a pip loss exceeding 25 unless you used less than 10% of your deposit. You should only close these ones when losses hit 50 pips.

Profit targets

The scalping method means profit is make by conducting several hundred deals per day to make a smaller individual profit. So larger profits are actively ignored in the pursuit of the numerous smaller ones. I used a trading strategy for scalping the yields profits of between 5 to 20 pips and these are driven by the behaviour of the currency. If a bounce happens quickly as a specific level has been achieved my aim will be 20 pips. But I will fix the profit at five pips if the bounce is slow. How currencies can behave when specific levels are reached

If a support or resistance level is reached a currency may respond differently. There could be the smallest movement at the precise spot the level has been indicated; sometimes a quick bounce happens.So we can now claim to know about responding on each level but some more points need to be made. Following a bounce and position closure, don't return to the market straight away as there might be a large bounce. As currency constantly maintains a specific trend, we should wait until the point gets to a specific limit.

You can often repeat a bounce deal as the currency will often head towards the level it has just rebounded from again. This can be done a number of times and buying a selling will occur again and again according to the currency pair nearing either the support or resistance level.

Some vital factors about scalping

It is easy to use scalping as a strategy but some points must be remembered constantly. Before trading you must ALWAYS look through the calendar of economic events. News will have a big effect on the pairs that are traded and the bouncing strong fluctuations won't happen despite strong levels of trade.

2. Emotions are useless for position traders and scalpers. As scalpers trade with larger volumes they are most affected. The market cannot be defeated any losses will be your punishment for attempting to do so.

3. Don't start unprofitable positions so close losing ones. A lot of deals are done over the course of the day so you need to work on the view that the overall profit will exceed the overall loss.

4. Things can change instantly so never move away from your computer. You need to be around to make instant decisions.

But the simplest way to start forex trading is to use an automated trading system and for this I would recommend the Forex Robot TFOT.

Some advice when picking a broker

Scalping needs to involve a broker so look for:

1. Narrow spreads like 0.8 - 2.5 pips for GBP/USD and 0.8 - 1.5 on EUR / USD
2. A very high speed of trade execution command

Scalpers are not favoured by all brokers and you might find some that will look to prevent a people from using scalping. Some might stop fixed profits being received. Avoid them. Successful scalping will be inhibited if you do not have a fast execution when trading.

• working at trend
•  
• working at flat
•  
• advisors used for trade on news
•  
• scalping systems
•  
• strategies for night trade
•  
• session systems.

Once you've decided which expert advisor to use to conquer the foreign exchange market, you should develop a plan of action.

A set of rules based around the following principles should be set and closely adhered to:

• the best time for trading
• the best currency pairs and timeframes for your expert advisor
• the market conditions that are best (flat or trend)
• trade at release of important news or wait for quiet market conditions

The main thing is that you should never leave the Forex expert advisor to work unattended, no matter how confident you are in it. There is a great world of potential in Forex that can be fulfilled by anyone. Just look for your goal, become skilled and you will never have to wait long for success.

Short Description of the Strategy Scalping in Silence

The chart window should be adjusted before you use this Forex strategy to start trading. Using the currency pair you have chosen you should firstly place the following indicators:
 

•  Parabolic SAR (0.02 and 0.2) ' green
•  Parabolic SAR (0.005 and 0.05) ' blue

Remember that you should only open up trades going towards the blue Parabolic SAR. In order to determine entry points, we will also need a Fibonacci grid. Once the price has broken away from the green-colored Parabolic, a Fibonacci grid should be built. This will be built between the last local maximum and minimum candle from where the reversal occurred.

When using the 'Scalping in Silence' Forex trading strategy, open a buy trade on the Fibonacci level of 50%. When it comes to placing the stop-loss, this should be placed at two points below the last local minimum. It is advisable to keep your risk limited to somewhere between 2% and 4%. At 164.8% on the Fibonacci level is where the take-profit should be placed. Or a trailing stop can be used. For opening up a sell trade, you just do exactly the opposite.

Description of the Simple Scalping Forex Strategy

You should adjust the chart window of your currency pair before you start to trade with this Forex strategy.

Firstly, you should place the following indicators on the chosen currency pair:

• Apply a simple moving average using a period 8 to the close price (SMA(8))
• 5,8 9 using the MACD indicator
•  On the price chart of GBP / USD place a Parabolic SAR (0.1, 0.11)
• Place another Parabolic SAR of 0.1, 0.11

however this time it needs to go onto the MACD chart (for this you will need to look in the terminal and open up 'Navigator', then go into 'Indicators' to find the Parabolic SAR which you can drag and drop into the MACD chart
The bets times to use this strategy are when the London and New York stock exchanges are at their most active.

Rules for Opening long positions

1. The majority of at least one 5-minute candle is above the moving average
2.  On both the currency pair and MACD indicator charts, the Parabolic SAR chart points should be below
3. Both the moving average and the MACD indicator should be above zero
4. A stop loss needs to be set for this system, as with all other free Forex trading strategies.To start with, this should be set up at 20 points from the opening price
5.  You shouldn''t set a take profit. You close trades using a moving stop loss
6. The stop loss should be moved to break even when the currency pair you are using moves 15-20 points away from the opening price. If you wish, you can use a trailing stop
7. The stop loss should be shifted to immediately beyond the price on the Parabolic SAR's second point as the currency pair moves in the required direction. There are times when the stop loss won't trigger such as if the Parabolic SAR moves to the upper part of a chart. Just wait for further developments if this happens If the indicator moved under the chart again, we would continue moving the stop loss after the second point

It's important to remember that free Forex strategies only become profitable if all of the rules are followed. To open up a sell trade you would need the exact opposite of these requirements.

Additional Conditions of the Simple Scalping Forex Strategy

 This strategy may be unprofitable when the release of important news is expected so it would be better to refrain from trading under those circumstances.

Description of Forex Scalping Strategy '20 Pips per Day'

1. When using this forex strategy only open transactions after 1100 GMT

2. It is very important to look through the news calendar beforehand to check if there is some important news for today

3. If you find out that some important news is due to be released today, you should wait until it has been communicated before opening the transaction It should be noted that this rule also applies to any other trading strategy, because many Forex strategies react after the release of important economic data

4. However if there is no news then you can trade from 1230 GMT

5. First of all, put a simple moving average with period 20 (SMA) and a momentum indicator with period 5 on a chart of a chosen currency pair

6. You should use a M30 (30 minute) timeframe for this forex  scalping trading strategy. I would also advise using the GBP/USD currency pair when trading with the '20 Pips per Day' strategy but you can use any other instruments, which will be presented in the terminal of your Forex broker. When using high volatility trading instruments, '20 pips per day' just like a lot of other forex trading strategies can bring high profits.

7. When the candle closes above the SMA (20) and the momentum indicator goes above the average level a buy trade can be opened. The conditions are exactly the opposite for a sell trade.

8. Place a take-profit of 20 points when profit-taking. You always have the option to make a partial close of a trade when the set profit of the trade is reached and then use a trailing stop for the second section. This is a way to make more than 20 pips per day.

9. The majority of Forex trading strategies use stop-loss, and '20 Pips per Day' is no exception. Stop-loss can be placed in a number of ways. You can place it at a distance of 20 points, or a bit lower (higher) of a moving average, or beyond the last local maximum (minimum).

10. Please note that the position should be closed immediately if the price crosses the SMA (20) in the opposite direction once a transaction has opened. And it's important to remember that, just like a lot of other forex trading strategies, you can make a profit if you closely follow all of the instructions and rules.

Problems with Dealing Centers

You should remember that problems with dealing centers can happen when a trading strategy is based on short-term trades. In order to avoid such situation, you should register at one of trusted dealing centers where pipsing is allowed.

Forex robot should be used carefully in spite of its irreplaceability. If you doubt about efficiency or correctness of the system, you shouldn’t risk your money and trust it to this forex software. First of all, you should try to adjust an advisor using a demo account. You can use any currency pair, having taken its history as a basis.

Only having made sure in efficiency and correctness of the settings, you can start using your Forex expert advisor for real trading.

• working at trend
•  
• working at flat
•  
• advisors used for trade on news
•  
• scalping systems
•  
• strategies for night trade
•  
• session systems.

Once you've decided which expert advisor to use to conquer the foreign exchange market, you should develop a plan of action.

A set of rules based around the following principles should be set and closely adhered to:

• the best time for trading
• the best currency pairs and timeframes for your expert advisor
• the market conditions that are best (flat or trend)
• trade at release of important news or wait for quiet market conditions

The main thing is that you should never leave the Forex expert advisor to work unattended, no matter how confident you are in it. There is a great world of potential in Forex that can be fulfilled by anyone. Just look for your goal, become skilled and you will never have to wait long for success.