View source for Finance:Forex signal

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A '''forex signal''' is a suggestion for entering a trade on a [[Finance:Currency pair|currency pair]], usually at a specific price and time.<ref>{{cite web |url=http://www.investopedia.com/terms/forex/f/forex-signal-system.asp#axzz1Z5052JhH |title=Forex Signal System |publisher=Investopedia |date= |access-date=2011-09-27 |archive-date=2011-10-11 |archive-url=https://web.archive.org/web/20111011112126/http://www.investopedia.com/terms/forex/f/forex-signal-system.asp#axzz1Z5052JhH |url-status=live }}</ref> The signal is generated either by a human analyst or an automated forex robot supplied to a subscriber of the [[Finance:Foreign exchange market|forex]] signal service. Due to the timely nature of signals, they are usually communicated via email, website, [[SMS]], [[RSS]], [[Company:Twitter|tweet]] or other relatively immediate method. In many jurisdictions signal services need to be registered with the authorities.

==Types of services==
Services provided fall into four categories:

#Unpaid/free signals
#Paid signals from one provider whether by personal analysis or algorithmic analysis
#Paid signals aggregated from multiple signal sources or 'systems'
#Signals supplied by trading software located on the trader's computer, also known as a forex robot or EA (Expert Advisor)

==Typical features offered by Forex signal service providers==
The main services offered by forex signal suppliers are:

*Exact or approximate entry, exit and stop loss figures for trades on one or more currency pairs
*Supporting graphs and/or analysis for the signals
*A trading history showing the number of [[Finance:Percentage in point|pips]] profit/loss per month and/or the risk/reward ratio and actual trades. Sometimes (especially in the case of forex robots) this may be shown as back-tested results
*One-on-one coaching, or additional interaction with the signal provider such as comments, forum, etc.
*Account management whereby a subscriber's account can be traded by the signal provider
*Educational resources either via the internet or phone
*A trial period for a lesser price

Although these are the main features of a signal supplier, not all of them offer the complete list of services.

==Scams and fraudulent activity==
{{main | Finance:Foreign exchange fraud}}
As forex is popularly touted as a get-rich-quick method there are a number of services that supply signals of debatable quality, which do not answer the users' expectations for profits.<ref>{{cite web |url=https://www.babypips.com/learn/forex/signal-services |title=Forex Signals |access-date=May 11, 2023 |publisher=BabyPips |archive-date=April 1, 2020 |archive-url=https://web.archive.org/web/20200401220558/https://www.babypips.com/learn/forex/signal-services |url-status=live }}</ref>

==Methodologies and trading strategies==
The majority of signal providers focus on supplying signals based on [[Finance:Technical analysis|technical analysis]] and a minority work on [[Finance:Fundamental analysis|fundamental analysis]] or [[Finance:Price action trading|price action]].
Technical analysis, such as ichimoku and [[Candlestick chart|candlestick chart]]ing, show both short and long term price trends giving the signal provider flexibility in supplying a range of trade options. [[Finance:Fundamental analysis|Fundamental analysis]] gives longer term [[Finance:Trade idea|trade idea]]s. Price action gives extremely [[Finance:Short-term trading|short term trade]] ideas, often more suited to [[Finance:Scalping (trading)|scalping]].

==See also==
* [[Finance:Foreign exchange autotrading|Foreign exchange autotrading]]
* [[Finance:Foreign exchange controls|Foreign exchange controls]]
* [[Finance:Foreign exchange hedge|Foreign exchange hedge]]
* [[Finance:Foreign exchange reserves|Foreign exchange reserves]]

== References ==
{{Reflist}}

[[Category:Financial markets]]

{{Sourceattribution|Forex signal}}