Free Forex Signals

Free Forex Signals – Can They be Trusted?

A lot of people have written to me recently, saying that they have signed up for a free forex signal service, traded on a live account, and then lost money.  In some respects, I have little sympathy with these guys.  After all, what do they expect for nothing?  Just because you enter your email address and name in a contact form on a website, what right does this give you to make profitable forex trades based on information received in emails from an anonymous source, hiding behind a website?

One of the things I tell these people, is that if you want to test out their signals, great, but do so on a demo account, not on a live account.  If you blindly follow the advice of  website, even for free forex signals, on a live account, then you asking for trouble.  You should always demo a strategy on a demo account for at least 3 months before going live, especially with free forex signals.

Secondly, don’t be afraid to contact the webmaster of the website in question, and ask about how they go about taking their trades.  Are they trading based on technical analysis, or just a hunch about where  they think the market is going.  It is all very well handing out free forex signals, but anyone can toss a coin, and decide on that basis if the EUR/USD is going to go up, or maybe down, on any particular day.  Ask to see their own trading accoount details – of course, they can black out the account details – but if these are true traders, they will have their own account, and will not be afraid to show you their accounts – indeed, most would be too happy to show you, if they had made huge profits on their account!!

So, to recap, DO NOT under any circumstances trade on a live account with free forex signals without first testing them on a demo account for 3 months, as this is usually the length of time it takes for a good forex strategy to show its worth.

Forex Signals:  How much attention should you pay to Performance Results?

It never ceases to amaze me how many forex signal websites there are, which are offering to double your money each month.  Site after site I see, the performance results are 10%, 20% , 30% a month – sometimes even more!  I don’t know about you, but I am very sceptical about these results.

My main piece of advice on this topic would be to completely ignore everything a website owner says about past performance results for his forex signals, unless they can back this up with hard proof from a live trading account.  More often than not, when you ask to see some proof, you will receive a reply such as ‘Oh, my broker does not provide tis sort of information’, or ‘This information is confidential’.  This is a sure sign that the perfomance results are fake, and he is trying to scam novice traders out of their hard earned cash. After all, why would he post his performance results if this information is so confidential – these explanations simply do not make sense!!

Also beware of screenshots of nicely increasing increasing equity curves, and a big profit and loss balance – these can easily be replicated on MetaTrader 4 by running an EA with different variables until the forex signals show a profit.

In conclusion, there are a lot of good, reputable forex signal providers out in the market today.  However, there are also a lot of scammers out there, who know that forex traders are desperate to receive profitable forex signals in order to make them successful.  Just make sure that you do your due diligence, and don’t get caught by a scrupulous website owner!

Why a Novice Trader should utilise Free Forex Signals

There are a number of reasons why a forex trader who is just emarking on a path to fortune and riches as a professional forex trader should make as much use of free forex signals as possible.  The first reason, of course, is that they are free.  When starting out in the forex world, most traders do not have a lot of funds, and so therefore it is much better to keep costs down to a minimum. By utiising free forex signals, traders get the benefit of trading with real fore signals and trade alerts, whilst at the same time, saving money.

There is alos not a great deal of evidence to suggest that by utilising free forex signals as opposed to paying upwards of $200 each month for a signal service, that they are any worse off.  There has been research conducted that there are as many scammers and unscrupulous websites who target innocent novice traders, and charge them $100 each month, as there are websites who don’t charge for their services.

The next reason, however, is not so obvious as to why a trader should use free forex signals. This is because, by using other people’s signals, you get a feel as to why they are making these recommendations.  So, for example, if there is a signal to go ‘long’ EUR/USD, you have the opportunity to review the charts, look at where the market is, and to take a trade on your trading platform.  For a novice trader, whis is of utmost importance, as unfamiliarity with your trading can, and often does, lead to very expensive tarding mistakes.