How do Forex MT4 Signals Work? A Basic Guide from Silicon Signals
Forex signals are a way to automate trading. They tell you which trades to take and when. The MT4 platform features thousands of signal providers. In this beginners guide, experts from Silicon Signals answer the key question: should you subscribe to paid signals or is it better to create your own?
What a Forex Signal Looks Like
Forex signals are essentially alerts – usually of potential trading opportunities. They prompt you to buy or sell a currency pair at a certain price and to set the take-profit and stop-loss at a certain value. A basic signal looks something like this:
“Buy USD/EUR at 1.0953 Take Profit X Stop Loss Y”
There are many ways to receive signals: straight in your trading platform (like MT4), by email or text message, or in specialized Telegram channels.
Since most traders use MT4, MT5, and similar platforms, MT4 signals are probably the most popular type.
Who Creates MT4 Signals?
Behind each signal, there is a provider – usually a professional trader. Some traders create signals manually by utilizing technical or fundamental analysis. Many others have algorithmic trading systems that do it for them.
Algorithmic trading means using a program (a bot) to identify trading opportunities based on a set of rules (strategy). The bot will monitor Forex trading indicators and suggest (or place) a trade when market conditions match the requirements.
MT4 features over 3,000 signal providers on its website. Their profiles clearly show if they rely on algo trading (note the ‘100%’ and ‘0%’ values):
Should You Pay for MT4 Signals?
Basic Forex signals on MT4 start at $30 a month. Are they worth buying? Here’s some advice from the analytics team of Silicon Signals – a platform for building no-code algo bots:
‘When you use paid signals, you blindly copy the provider’s trades. You have no idea how their bot is programmed. And since no bot can be profitable 100% all the time, you’ll have some losing trades but you won’t know if you should stick with your current strategy or if it has failed. With automated paid signals, you are not learning anything, you’re just taking orders from a black box.’
Create Your Own Signals for Free with Silicon Signals
Instead of paying a complete stranger, you can build your own algorithmic trading bot and create Forex signals yourself. This is possible thanks to Silicon Signals – a platform where you can build a trading algorithm in minutes without writing a single line of code.
Start with defining your strategy using the Silicon Signals point-and-click builder. Add conditions and set your Take Profit and Stop Loss parameters. Back-test and/or paper-test your strategy to see how it works with past or current market data. That’s it, you’ve built your first trading bot.
Sample strategies in Silicon Signals
Next, install the Silicon Signals Expert Advisor for MT4 or MT5. Your bot will feed signals into the platform to place trades.
Take Back Control Over Your Trading
The key advantage of Silicon Signals is that it puts you in control of your strategy and your money. You’ll know exactly why a trade was executed and be able to tweak the bot whenever the market conditions require it. This solution gives you the convenience of automated signal trading and at the same time prompts you to study, build smarter strategies, and ultimately become a better trader.
For a limited time only, Silicon Signals is available for free. To build your first strategy and start getting signals, head over to the official website.
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