Trading Without Signals: The Pros and Cons

With technology having an influence in almost every sector of the human life, forex trading hasn't been left behind as well. Here, we look at what trading without signals means as well as its pros and cons.

November 24, 2021

Trading Without Signals: The Pros and Cons

The trading world is full of various trading signals, trading apps, trading strategies, and more. However, some traders choose not to use them for trading on their own terms.

They are experienced enough to research themselves and know how to execute trades without help from signals or trading robots.

So, when it comes down to it, what are the pros and cons of trading without signals? Let's find out!

What Are Trading Signals?

Briefly, trading signals are trading alerts sent to traders when a certain condition is met. They automatically make trades on your behalf, based on the trading signal you chose for them to follow.

With trading signals, users can automate their trading strategies and let the software do all the work! This way, they don't have to sit in front of their trading screens all day, trading manually.

However, trading signals aren't as simple as they look! There are several things you need to consider before starting to use trading signals:

First, trading signals can help traders make more money, but not necessarily. If a trading signal tells them to trade in the wrong direction, it will lose them money instead.

Second, trading signals have a trading plan built in them; but it's not the trader's trading plan! It is based on past data and might not be suitable for future trades. So even if you trade with your trading signals, make sure to develop your own trading strategy so that you can adjust when trading signals are not trading as you want them to.

In summary, trading signals might save traders some time and let them trade more often; but they can also give them bad trading advice that will lose money instead!

Can You Trade Without Signals?

Absolutely! But the reasonable question here is, should you? Please don’t get us wrong, trading without signals is definitely possible, but it requires a lot of time and effort to build the trading knowledge you need.

Advantages of Trading Without Signals

There are some major benefits for traders who can trade without signals. First, having complete control over their trading decisions will allow them to be flexible with their trading style without signals. On the trading floor, you will see traders following their trading system closely for each trade they take, called rigid trading style.

Another big benefit to trading without signals is that it gives them more control over how much money they make in a day; however, again, this isn’t always true as there are many reasons why trading without signals is not always the best trading option.

We are aware that trading without signals is possible. But whether or not trading without signals will be beneficial for you depends on your trading style and personality.

Traders who prefer to trade with their own discretion when making trading decisions can definitely try trading without signals. However, they need to understand many trading factors are out of their control.

Disadvantages of Trading Without Signals

Trading without signals can be difficult because it is hard to learn the necessary trading skills. There's more than just buying and selling on your own, and there's also technical analysis of indicators like moving averages, support levels, resistance levels, etc.

Many trading signals apps focus on this kind of trading analysis, which is also a disadvantage if you trade forex without trading signals. It means you won't have any help from an app learning how to read indicators and anticipate market movements.

This leaves you trading blind, trading by gut feeling, or trading using a trading strategy that is too simple.

Do You Have Control Over Trading Signals?

Unlike copy trading, where you match all your activities with those of the trading master without any control, trading signals give you a chance to choose those that work best for your trading style.

With these signals, however, it's more of getting an idea of trading opportunities available in the market. You can act upon trading signals, but it doesn't mean you have to do so.

Can I Rely on Trading Signals?

Yes, trading signals can be a trading strategy, but they come with their own set of pros and cons.

Trading signals are one of the best ways to make trading easier and more accurate. However, not all traders want to use them, and some even consider trading without any signal generator. There are several arguments in favor of either side, but there is no clear-cut answer because it depends entirely on personal preference. The benefits of trading with signals include having trading decisions made for you, trading automation, information on when to buy or sell, and more.

On the other hand, trading without signals has its own set of benefits, including being your sole decision-maker in trading transactions with no outside influence. However, trading without signals can also be detrimental because the trader may not have enough knowledge to make trading decisions independently or promptly. This can lead to poor trading performance with missed opportunities and more.

Why Do You Need Trading Signals?

To recap, trading signals are trading alerts sent by trading platforms to the traders who follow them. These trading signals help forex traders make informed trading decisions, as they can now factor this information into their trading strategies and act accordingly.

This means that these trading signals take away much of the guesswork from trading, and traders don’t need to monitor the market anymore to develop trading ideas constantly.

If you are new to trading in the financial markets, trading signals are helpful. These trading alerts will help you learn about various trading strategies and apply them in real-life scenarios.

However, trading signals have their limitations. There is no perfect solution for forex trading as it all boils down to your personal preference and research on the market.

Final Thoughts

The trading market is a lot different than other trading markets out there. While it might be easier to trade without signals, you will not have the same results as if trading with them.

As mentioned above, trading without signals can lead to average trading returns and long periods of drawdown; however, this has never been shown by research studies or trading professionals.

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