I’ve found Forex Quake and began thinking that enrolling for a free foreign exchange signal service sounds like a brilliant idea. The alerts will tell you exactly when to trade and you can profit from forex trading really simply that way, without needing to do any of your own research or technical analysis. At least, that is the idea. But does it actually work in practice?
There are a couple of things to grasp if you are thinking of joining a free currency exchange signal service. First, think about why the service is free. Ask yourself why anyone would give away money-making foreign exchange signals for free .
Some alerts are given away by firms or individuals who are hoping to you up for some other (paid) service later. Sometimes they’ll give you all the info you will need to make successful trades (when to open, when to shut, stop loss and profit targets). This is fine and all you’ll have to do is accept that they may email you with other services from time to time.
Other times you’ll find that though they send an alert when conditions are good for trading, they don’t tell you awfully obviously what’s the basis of the system, so you are not sure what profit you are aiming to take or what your stop-loss should be. This isn’t so good because you can end up just guessing those things. You cannot work them out for yourself without knowing the entire system including the root of the caution. So you might be better off doing the whole thing by hand.
Even worse is a scenario where the free forex signal is being sent by a hobbyist who has zero intention of earning profits from it. Certain that sounds great but you almost certainly don’t know who he is or what success he has with trading. Why should you trust his foreign exchange alerts instead of trusting your own ability to trade successfully?
In another situation, the company may send free alerts on a trial basis. For instance you could receive free alerts for two weeks. This is so that you can test out the service (which you need to do in a demo account) and they hope that after that time you will want to receive the signals even though you’ll have to start paying. This is the ideal situation because the Firm has a powerful interest in making you successful. The signals they send out in their free foreign exchange signal service are doubtless precisely what their paying customers receive, and to keep their business they have to have their customers making money.