I do say that EAs or other automated black box systems doesn't work. I'm not saying that a mechanical trading approach doesn't work.
First... when you design your automated system, it's ok, you know what's happening, but if you buy something "magical" that it's going to do the work for you... I shouldn't be so proud... or confident. Using an EA or similar for automated trading seems risky to me.
I think that a system like this could be useful to generate signals rather than trigger the signals. In that case the trader could make a valid analisys and go for it. To me is just too much risk to let trades be trigger automaticaly.
Let's see a hipotetical scenario. What could happen if a signal is automatic triggered... I suppose that a stoploss is immediately defined and also a profit target. What happen if that open trade runs against the position towards the stop. That shouldn't be a problem right? (due money management) Here is the catastrophic scenario that I fear most... what if there is a gap through the stop order? What would happen if you are not there? In a less tragic scenario, in the positive side, that wouldn't be so bad... but actually it is. What's if your planned profit target is reached and there is no order to close the position?
That's one scenario. Let's picture another one. What would happen if market action is so fast that your automated strategy just can't get that stop order filled and just passed by?
As said early... this shouln't be considered as a complete discredit about automated systems but just a few things to think about.
A complete different story is a mechanical trading system. And that's what I'm focused on. Make rational and inteligent decisions based in technical analysis. History tends to repeat itself. When a setup is met, act based on the system, period.
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