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Disadvantages of Automated Forex Trading

You may have already read about the nice advantages of automated Forex trading. But, of course, you understand that trading using expert advisors is not always as good as it seems. Everything has its own pros and cons; so automated trading has its own disadvantages. You can find the list of them below:

  • No intuition to help you in trading. Computers and programs simply do not have anything similar to that mystical human gut feeling. While some traders do not think that intuition can be helpful in trading, others rely on it — such traders probably will not be pleased with automated trading.
  • Smooth trade execution and uninterrupted run-time of expert advisors is critical with many trading systems. Unfortunately, it is something very hard to achieve running EA from your home or work PC. That means that you would need some dedicated server to run your automated trading robots.
  • Some types of strategies are simply impossible to implement as actual expert advisors. Chart patterns or wave analysis and most of fundamental analysis are extremely hard to code into a trading program. At the current level of AI development, these tasks are better performed by the live trader manually.
  • Expert advisors should be made at high quality level or otherwise their trading results will disappoint you. Unfortunately, not all expert advisors handle errors and other unexpected events correctly — sometimes this can lead to huge losses. Moving your working EA from one broker to another can also be a problem since brokers' servers differ, and what works perfectly at one broker can stop working at another.

As you see, nothing is perfect in this world and, while being an extremely interesting and popular tool, automated Forex trading has its own problems. The wise decision here, in my opinion, would be using both types of trading to your advantage. The systems that can be easily implemented as an expert advisor and are too hard to be traded manually are better to be automated, while simple systems that involve chart patterns and fundamental analysis are better left for manual trading.