You can buy lots of Forex robots or so called Forex Expert Advisor's online but most are junk and won't make you any money and it's a fact you can do better yourself and make a trading system which can make money – so lets look at how to make a Forex robot.

Before we look at how to make your own Forex robots let's take a look at the commercial ones, how they build them and why they don't work.

Why Most Commercial Robots Fail in Real Time Trading

The first point to keep in mind is - most vendors who make commercial robots are not interested in the robot making money. All they are interested in is presenting the best track record they can which has high returns and low draw down, so the naïve and greedy trader buys it.

So How Do They Get the Track Records to Look so Good?

The answer is - back testing and bending a set of rules to fit the data which is known as curve fitting. They keep adding and subtracting rules, until they have a system which show high returns and low draw down.

When they build these systems, not only do they bend rules to fit the data, they have no real money management and either take far to little risk on a trade or in most instances – too much.

I have seen one robot where it claims the trading signal made 10 pips profit but before it came back into profit - it was negative 625 pips.

Bending a track record to fit back data is doomed to failure because prices never repeat in exactly the same way again and the system gets destroyed. The vendor then makes up another one and another one, with the same result and makes a tidy income on sales, while the buyer simply losses.

So if you want to make a Forex robot you can and now we will take a look at how to do it.

Making Your Own Forex Robot

The first point to keep in mind is that the best systems are simple and robust and its a fact that simple systems work best and always have. Also simple systems will not be subject to curve fitting and the back test results will be realistic.

A key point to keep in mind is that if you are looking to make a Forex trading system – it will have draw down. There is no perfect system! Here are some general guidelines on building robots.

Simple Price Action System

You can make money even with a 1 rule system and on this site you will find a system which does just that called the 4 week rule. This system doesn't use any indicators and is based purely on price action and works.

Standard Deviation of Price

Another great way to trade is to base your system on volatility and I have known several systems which have just traded standard deviation of price and piled up huge gains, with one making 100,00 to 1.1 million in just 2 years.

Indicators

Its always tempting to use a large number of indicators but you should resist the temptation, as we said earlier, because it will lead to curve fitting. Keep the number of trading indicators to around 4 or less.

Focus Long Term Trade All Markets the Same Way

If your system is based on sound principles it should work in ALL markets avoid unique rules for different currencies or different trading conditions – this is the worst type of curve fitting and destined to fail. Also focus on long term trends and don't try and trade random short term moves.

Finally, employ a set of money management rules which give you objective levels where you are stopped out and your all set to trade your own Forex robot.

Final Words

Making a Forex robot is a lot simpler than most people think and if you spend a little time and follow the above guidelines you will have a trading system you can trade for big Forex robots and make a great second income in around 30 minutes a day.