Forex Trading Signals Explained
If you are new to trading or are a fan of Forex trading but haven’t been able to take that next step to improve yourself it’s probably because you have never been privy to forex trading signals and haven’t developed any Forex trading strategies. Have no fear, Betting.co.uk is here to help you step up your game and learn a little more about trading signals UK.
A forex trading signal is essentially a strong indicator for when the right time is for you to buy or sell a money market asset i.e forex. These indicators or signals are based on a strong foundation of analysis that is either automated or manual. What we mean by manual is essentially a person sitting behind a computer doing the research themselves. Whereas the automated analysis would be the trader putting in a series of inputs into computer software to essentially teach it what to look for. There are a couple of schools of thought about forex signal analysis which we will touch on later.
Signals can be generated from a multitude of different inputs and other financial markets such as currency pairs, bonds, stocks and more. Let’s take a closer look at how generating forex signals actually works and what you need to understand to make sure your signals are beneficial.
How Forex Trading Signals Work
Forex trading signals can really help to guide you towards smarter and more profitable forex trading when done correctly and with the right inputs. Before we get to what inputs you can use to generate the best forex signals, let’s take a quick look at some of the different types of analysis that traders and providers use to find the best forex signals:
Forex Signals Analysis:
The best individual traders and signal providers use detailed analysis to generate a solid selection of signals to guide their forex trading in the right direction. There are a couple of different analysis types but you can boil it down to three most important and frequently used analyses types:
Fundamental: Fundamental analysis uses factors like economic events and markets news that influence the price movements of forex currency pairs. A fundamental signal will largely point to signals like interest rates which can inform trading decisions. Essentially, fundamental analysis looks at present, real world market news and events to measure the intrinsic value of forex trading instruments.
Technical: So, how does technical analysis differ in this regard? Technical analysis looks more closely at the historical factors of forex trading instruments like the price movements and changes in the charts over the years. Technical analysis basically uses the most pertinent past information to inform a decision about what forex trading instruments will look like in the near future. This is how technical analysis generates forex signals.
Quantitative: This type of analysis uses mathematical measurements and research to better understand the movements of forex markets in the past, present and future. Essentially, quantitative analysis uses mathematics to generate forex trading signals from numerical values in the market.
All three of these types of analyses are used in trading to help generate reliable forex signals. Each analysis type has had its own successes in the past but you will more frequently see the use of technical and fundamental analysis to inform forex signal generation.
Inputs to Use for Forex Trading Signals
As you have now seen, there are a number of variables with regard to the analysis type you use to help inform your decisions about forex signals. These signals need more than just pure analysis to be generated though as you need to have a certain set of criteria that is going to help inform your decision.
So, how would you do that? Well, the answer may not be straightforward but there are a number of different inputs you can mix and blend to give you a winning recipe for generating forex signals. There is a multitude of different inputs you could choose from but here are a couple of the main options that the most successful forex traders use to generate signals:
Technical patterns: a technical pattern is the way that the price of a forex trading instrument moves on the analysis charts. The patter that the movements create can indicate whether there is a breakdown or a breakout. Essentially, a positive or negative outlook. These patterns form a number of different shapes that can indicate unique things for generating a forex trading signal.
Moving averages: Most traders watch 50- and 200-day moving averages. However, there are a number of different variations out there that many traders use as well. It will depend on how you think you should respond to moving averages. Your specific input could tell you to act when the moving average crosses a certain threshold or when two moving averages cross each other. Like we say, there are a lot of different ways you can input data based on moving averages to inform a trading signal.
Volume: Quite simply, a volume surge in the fore market can serve as an indicator or call to action for forex traders. You may want to move on a trade in light of a volume surge which could indicate a rise in value of a currency pair. The cases will vary but either way a volume surge can serve you well as an input.
Interest rates: changes in interest rates can be indicative of upcoming price movements in specific forex currency pairs as well. Using an interest rate input in conjunction with different inputs can produce an informative forex trading signal that could help you on your way to a smart trade.
Valuation: There will be times where you may see a swell in the valuation of a forex currency pair which could be a call to action for you to sell. If these valuations seem too high in relation to the sector then it may be a strong indicator for the sale of that specific forex.
Relative Strength Index: the relative strength index measures the spend and change of forex price movements. Signals can be generated from this by observing any divergences and failure swings.
Resistance Levels: resistance levels are a great way to observe price movements in currencies. A breakout will occur when the price point of currency is on an upward trajectory and break through the resistance level which can be a strong indicator to buy.
How to Find the Best Forex Signals Providers
Just as there are a number of different inputs that lead to even more forex trading signals, there are also a number of forex signals providers as well. These signals providers can vary in what they offer you, how many signals they generate per day and what some of their costs are. It can be a tough ask for you to search the webs and pick out the best signal provider from the lot.
At Betting.co.uk we make this a little easier for you by picking out some of the best forex signals providers in our reviews and rankings. This way, you can avoid trudging through the terrain of online reviews and webpages and instead get right to who the best signals providers are. By using our website you can view all of the best forex signals providers in one place and from there make an educated decision from the number of different reviews that we have conducted.
Our rankings and reviews are completely unbiased and wholly objective. We give you a decisive look at these service providers and tell you all there is to know about the forex signals daily that you will receive. We also give you a breakdown on the most important features on the site and what sets each service provider apart from the next. You won’t miss a beat with our in-depth analyses.
Who Are The Best Forex Signals Providers?
While we have you here, we thought it would be a good idea for you to dip a toe in the water with some of the best forex signals providers, so to speak. That is why we have put together some of our personal favorite service providers for forex signals UK:
Live Forex Signals
There are few forex signals providers who have put together such an effective website interface. The website itself is easy to read and gives you incredible detail on forex signals daily with its real-time performance chart. Live Forex Signals even give you the history of the past signals issued on the site as well as how successful each signal was. This forex signals provider is wholly transparent with their results which makes the user feel like they are involved with an authentic and honest signals provider. If you are struggling to find a solid option then we highly recommend that you at least check the Live Forex Signals platform out.
Forex GDP is one of the better forex signals provider options as it offers a service to all types of forex traders. You can use the free service of the site and receive up to 4 free signals per month. If you want to step it up a notch then you can pay for a premium plan where you will receive up to 12 forex signals and 6 trade ideas in a month. And lastly there is the supreme plan option where you can receive a whopping 25 forex signals in the month. Forex GDP is a high quality forex signals service and will no doubt do a stellar job in providing you with accurate forex trading signals.
At FXLeaders you will find a number of useful educational resources like the latest news and opinions on the most recent developments in the forex market. And while the educational pieces are great, the forex signal production on the site is even better. FXLeaders allows you to sign up for free or pay for the premium package. It’s a great way for new traders to get a feel for the site, test out the couple of free signals you get and then possibly move onto the premium service. The costs for the premium service are very reasonable in comparison to some of the other forex signals UK providers. FXLeaders is the perfect forex signals platform for every kind of forex trader which is why it has made its way onto our list.
Using Forex Signals To Your Advantage
You should now have a fairly good idea about what forex trading signals are and how you can best go about using them to your advantage. Forex trading signals can be found in a number of different ways but our team here at Betting.co.uk would recommend going with a solid automated method supplemented by a solid forex signals service. The beauty of finding the best forex signals is that you have a number of different options available to you for how to find them.
Remember, you may not always strike gold with forex trading signals as the market can change at the drop of a hat. However, it’s always better to have some additional pointers and a guiding hand than to not. Keep the inputs we mentioned in mind and then slowly start to tailor your own forex signals with your own inputs and automated signals generator. Check out our guide on CFD trading signals to learn more about another opportunity to expand your trading horizons.
Forex Trading Signals FAQ
❓ What are forex trading signals?
Forex trading signals are an interesting avenue for newer and more experienced traders to take to improve their overall trading experience. At Betting.co.uk we understand this all too well which is why we go into depth about what forex trading signals are and how you can take advantage of them. Our readers who are new to trading will find this signals guide particularly useful.
🔎 How do I find accurate forex trading signals?
Knowing what forex trading signals are is one thing but finding them is a whole other kettle of fish. Our forex signals trading guide will teach you how you can find the best forex signals, what to look for and how to know which of these signals you should act on first. There are a number of variables when it comes to forex trading signals so it’s a good idea to equip yourself with a strong foundational knowledge.
💯Are forex trading signals right 100% of the time?
As we mentioned before, forex trading signals can take your day-trading to the next level but the fact remains that you will need to invest a decent amount of time to make it work. Our forex trading signals guide at Betting.co.uk will give you a better idea of just how successful these forex signals are most of the time and whether or not you can wholeheartedly rely on them.
✅Who is the best forex signals provider?
While you can technically find forex trading signals on your own, this can be quite time-consuming. You don’t have to go it alone if you don’t want to. Which is why at Betting.co.uk we give you a couple of favourite and most trusted forex signals providers that you can sign up for at any time. Make your life a little easier by choosing from our list of forex signals providers so that you can save yourself time searching the internet aimlessly.
💲Do I need to pay for forex signal providers?
Forex signals providers are a great way to make your life easier and to find forex signals from a single platform. Each of these broker websites will vary in terms of what they offer you, how easy it is to sign up but most importantly in the included costs of using the site. We include every cost that you might run into with our forex signals guide so that you won’t run into any surprises when you check some of the best provider platforms out.