How To Find The Best Free Forex Trading Signal
Are you new to forex trading? A ‘Yes’ or ‘No’ answer doesn't really matter. Profiting off free forex trading signals is a very smart and clever way to trade the forex market profitably and make a lot of money with ease.
Forex signals, when used the right way, can give you an edge over most of the uncertainties and risks associated with trading. More so, forex signals have the potential to grow your trading account at a steady pace. Besides saving time and effort to find good trades, you will be relieved of the burden of going through the lifelong learning process to mastery. The most important thing you have to know is that you must understand the content of trade signals, the basics of the market and the know-how or the application of these signals on your trading app.
Forex signals can best be described as detailed trade recommendations or ideas that must be issued by reliable and seasoned signal providers that have achieved consistent and impressive results across a wide range of financial assets and in different market conditions.
There are numerous online services and websites that provide forex trading signals, for a fee, or even for free.
Throughout this article, we discussed how and where to find the best free Forex trading signals.
Free forex trading signals
A forex trading signal is considered free if it is provided at no cost or expense. These are trade recommendations and ideas based on technical or fundamental analysis (macroeconomics and impactful news events) that helps to identify trading opportunities.
They can be presented in different forms of market orders. The types of orders featured on most trading platforms are either
- Direct market order
- Pending market order
- Limit market order
This is an example of a forex signal as shown below
The content of forex signals generally begins with the direction of a trade setup. It can either be a Buy (Long) or Sell (Short).
Next is the name of the trading instrument. It may take the form of the currency symbol 'GBP/CAD', or a currency nickname like Cable OR Fiber.
This is followed by the market order price quotations of five or four digits after a dot.
The quotations are basically
(I) Entry price
(ii) Stop Loss
(iii) Take profit
As you can see from the example above, the stop loss is set 30 pips away from the asking price and the take profit 50 pips away from the entry price.
Sometimes, trade signals do come along with risk management parameters like trailing Stops, Break Evens and Partial Close. These additional options provide more control over the risk exposure of trade signals but not every broker and trading platform offer these features.
Sources and delivery
Forex signals can be sent and recieved via phone messaging, Skype, email, communities and trading forums on Reddit, Facebook, YouTube, Instagram, and even on WhatsApp. Today there are lots of trading forums and communities providing free forex signals on Telegram.
Forex signal sources can be from retail firms, pooled asset managers or individual traders that offer trading signals either for free or for a fee (daily, weekly, or monthly). By professional recommendations, they claim to have the skill set that helps them to identify high probable buy and sell opportunities to make a lot of profit. There are a lot of websites providing Forex signals online and with the help of social media, it has become easy for people to share free and premium Forex signals. Forex signals can be gotten from three main sources:
Professional traders
In many cases, traders are eager to share their ideas with the rest of the world. They do this to earn the reputation of a trustworthy trader, to help other traders, including beginners, and also to support their trading communities.
It is common to find professional traders who share free FX signals on trading forums, including Forex Factory and TradingView. They do this by analysising price movement thoroughly and then providing trade signals with all the information that has to do with the trade (and the currency pair).
Affiliates
Besides professional traders, affiliates are another group of signal providers. Oftentimes, once you sign up for an account using a broker's affiliate link, you are likely to get free daily Forex signals. This way affiliates can make a commission on every trade that you take and in most cases, you may get their trade signals for free.
The caveat to affiliates' trading signals is that the quality of their signals may decline over time as they often devote more attention to marketing and promotions. This is true because not every person has enough time to support both their affiliate business and their trading activities, so you should be cautious about this group of signal providers.
Traders ought to vet the profitability and consistency of any free affiliate signal on a demo account before taking the risk on a live account.
Scammers & Fraudsters
A fraudster touts his or her long experience and trading abilities, along with testimonials from friends and family who recommend the person as an outstanding trader and friend, who have earned them some immense amount of wealth. The unsuspecting trader falls prey by handing over his money for the privilege of receiving trade recommendations that are actually unprofitable.
There are many forex signal fraudsters who charge fees from forex traders and then disappear. If peradventure they give free signals, they occasionally mix up good and bad trade signals as a bait to access premium signal service. Some might only be interested in making affiliate commissions. Scams like this are becoming more and more common. hence, one should always be sceptical.
Types of signal services
Sources of trading signal services may either be automated or manual. Automated trading signals differ from manual trading signals because they require little or no effort but the right setup and configuration to execute trades on any trading platform. Automatic trade signals may also come along with automatic trade notifications like high-impact news, high or low market volatility and notification of trade completion. Furthermore, it can be a very useful tool for novice traders to learn about the market and different types of market analysis.
At first glance, automated trading signals may seem appealing, but some people wonder if they can trust them with their hard-earned money. Choosing which signal provider and which signals to use depends on your risk management appetite and trading style, so it is important to educate yourself on trading before using any signals. You must also review different brokers thoroughly to avoid unexpecteed fees, unexpected losses and scams.
Advantages of using trade signals
- Continuous learning opportunity. You will have the opportunity to watch, analyse and review the outcome of the trades signals that you execute or that have been executed.
- An opportunity to earn profits while learning. You can earn money while you are learning different types of analysis and mastering different strategies.
- Trading signals can help build confidence in trading when consistent profits are made. Novice traders can also boost their trading confidence when their analyses and trade direction is validated by a good signal provider.
- This enforces discipline on traders that utilize trade signals because you only have to trade when there's an opportunity provided by your signal provider. By doing this, you are relieved of the stress of constantly staring at your computer screen.
5 Using a forex signal provider that has been proven to be consistent and profitable reduces the emotion that is attached to open trades.
Disadvantages of using Free trade signals
- Many traders become lazy. They stop learning, studying, and analyzing the market because they now rely only on signal providers.
- In some cases, traders over-leverage trade signals because they place so much trust in signal providers. There is no guarantee that any signal is accurate because the signals derived from technical and fundamental analysis are not always right.
- Free trading signals often lack quality. Any forex signal provider that dishes out quality trade signals that is consistently profitable, sooner or later may begin to charge expensive fees that will reduce your earnings.
- It is possible that the signals do not align with your trading style so you have to do the work of adjusting your trading plans to the provider's signals.
Caution to using Free Forex Signals
How easy it is to earn free money with free trading signals. Perhaps out of luck or thorough research in finding good free signals with high win ratings. Keep in mind that these free Forex alerts and trading signals may not be around the corner indefinitely.
Finding free accurate forex trading signals can be challenging and the readily available free Forex signals are most often not the best. It is important to vet the quality of any signal provider before making an attemp to profit from these signals on a live account.
When screening for the best free forex signals, here are checklists of important factors that must be reviewed in a selection process.
- Time Zone: Be sure to know the timezone of your signal provider so that you can align the trade signals accordingly to your timezone. You also want to be sure to subscribe for signals that are provided at the times of the day when you are awake.
- Demo Trial: Use a demo account to test run the quality of free trading signals. Before applying the trade signals to a live account, you must ensure consistency in profitability for at least two weeks.
- Make comparisons: Finding a very good free forex trading signal is a task. It is important to find as many free signal providers as possible, compare their output, and then decide which of these providers fits best with your trading style and risk appetite.
- Track Record – Online reviews can help you evaluate free forex signals. You should also evaluate the track record of any free signal service from a credible third party. This will provide you with all the information you need to know about the quality of any such free signal service.
To conclude, rather than just trade parameters like entry prices, take profits, and stop losses. You should consider signal providers who provide trade signals along with educational articles, fundamental and technical analysis overview and market outlooks.
Good Luck and Good Trading!
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