Top RoboForex Strategies for Achieving Profitable Trades

When you buy and sell currencies on the Forex market, you are participating in the largest and most liquid financial market in the world. It doesn’t matter if you are a novice or a professional, having a method to follow is essential. There are numerous effective trading strategies available for the RoboForex platform that you can implement. In this piece, we will take a closer look at some of the best techniques with detailed examples, and determine which ones are most suitable for beginners.

The Importance of a Well-Planned Strategy for Trading on RoboForex

Having a strategy when executing trades in financial markets, specifically through the RoboForex broker, is a reasonable act. Without a clear plan or approach, traders often make impulsive choices that can lead to losses. We’re going to provide the main reasons why using a certain method is important and provide specific examples.

1. The strategy helps to control risk.

Suppose you are trading EUR/USD and decide to open a position without analyzing it. You put your entire deposit (for example, $1000) into one trade, hoping for fast growth. If the price goes against you, you can lose all your money in a matter of minutes.

If you have a strategy, for example, the rule to risk no more than 2% of your deposit per trade, then the maximum risk will be $20. This will allow you to keep your deposit even after a series of unsuccessful trades.

2. The strategy reduces the influence of emotion.

Let’s say you opened a position to buy Apple stock, but the price started to fall. Instead of closing the position at a predetermined stop loss (e.g. -3%), you hope that the price will come back up. Despite this, the price keeps falling, causing the loss to widen to -15%.

If you had a strategy with clear exit rules, you would have avoided such losses.

3. The strategy identifies profitable patterns.

For instance, you have decided to use a moving average strategy. The rule is really easy to follow. If a fast MA (e.g. 50) crosses a slow MA (e.g. 200) from bottom to top, it is a signal for you to buy. However, if a fast MA crosses a slow MA from top to bottom, it is a sell signal.

This system might help you make more objective decisions and avoid blindly relying on intuition.

4. The strategy helps evaluate and refine trading performance.

Let’s imagine the situation when you want to use a tactic that relies on monitoring support and resistance levels. When trading a month like this, you analyze the results and see that 70% of trades were profitable and 30% were not. Of course, this indicates that the strategy is working. But if only 40% of your trades are profitable while 60% result in losses, perhaps the strategy needs to be changed.

5. The strategy adapts the approach to market conditions.

During periods of high volatility (e.g. at the release of important news), your strategy may involve not trading or using wider stop-losses. Without such adaptation, you risk losses due to rapid price fluctuations.

6. The strategy ensures proper money management.

Let’s look at an example where you use a position trading strategy and each trade lasts for several days or weeks. Let’s assume your deposit is $5000 and you decide to open no more than 5 positions at a time. You also don’t want to risk more than $50. Evidently, it is a safer choice, even if some trades turn out to be unprofitable.

Trading without a strategy becomes a game of roulette. This means that your success depends solely on luck. When you utilize a proven strategy, your chances greatly increase in the long term.

Finding the Best RoboForex Strategy: Top 5 Methods

#1. Trend Following Strategy

Trend Following Strategy is a well-known method based on the idea that prices move in a certain direction (up or down) over a long period. Traders using this strategy try to take a market position at the start of the trend and exit at its conclusion.

This strategy is considered to be especially effective on RoboForex platforms, such as MetaTrader 4/5, due to the availability of technical analysis tools and trade automation.

How Trend Following Strategy Works?

Initially, assess the market trend, namely, utilize technical indicators (e.g. moving averages, MACD, ADX) to analyze price direction. Then, you need to open a position that follows the trend’s direction. This is called entering a trade. Buying occurs in an uptrend and selling occurs in a downtrend. 

After that, set a stop loss and take profit.  The stop loss will help limit losses if there are any, the take profit will help you take profits depending on the strength of the trend. From there, simply follow the trend and close the position at the right moment when the trend changes or weakens.

Let’s go through an example. When trading EUR/USD on H1 using SMA(50) and SMA(200) as well as MACD, you can make a profit of 100 pips at a risk of only 50 pips if you identify the trend correctly.

First, you identify the trend. The situation is when the current price is 1.1000, but the chart shows that the SMA 50 has crossed the SMA 200 from the bottom to the top which is called the ‘golden cross’. The MACD line is above the signal line. The price remains above the SMA(200), for example, SMA 200 = 1.0980. Following this, you initiate a buy (BUY) order at 1.1000. 

Then, you set a stop loss and take profit. If the price reaches the take profit (1.1100), you make a profit of 100 pips. If the price falls to the stop loss (1.0950), your loss is limited to 50 pips. That’s how simple the Trend Following Strategy works. 

#2. Breakout Trading Strategy

A Breakout Trading Method is an approach based on executing trades at times when the price breaches key support or resistance levels. Market players use this strategy on RoboForex to capture strong price changes, which often happen after the breakout of important levels. 

Why is this strategy effective on the RoboForex platform? It has everything necessary for its implementation: availability of charting tools and trade automation, such as MT4 or MT5.

Breakout Trading Strategy Explained

1. The user needs to locate support and resistance levels, which are areas where the value has previously reversed.
2. As soon as the price breaks through one of these levels, it’s the signal to enter a trade.
3. Setting stop loss and take profit helps to limit losses and lock in the profit.
4. After that, monitor the price dynamics closely. Should the price move back past the broken level, confirming a false breakout, it’s best to exit the market.

Let’s look at an example. You would like to trade the GBP/USD pair and choose the timeframe of 1 hour. You spot the current price is 1.2800, and the key resistance level is 1.2820.

First, recognize the level from the chart. The chart shows that the price has tested the resistance level of 1.2820 several times, but failed to break it. You can also see that the Bollinger Bands lines are narrowed, indicating consolidation.

Secondly, you have determined that the price is breaching the 1.2820 resistance level from above. Additionally, you notice a substantial increase in trading activity, which confirms the strength of the move. In addition, you can see that the Bollinger Bands lines are starting to expand. This means that we can open a BUY position at 1.2830 (slightly above the broken level for confirmation).

At the same time do not forget to set stop loss and take profit: 

• You set the stop loss at 1.2790 (40 pips below the entry point).
• Take Profit is set at 1.2950 (120 pips above the entry point).

Now, all you have to do is to follow the price movement. If the price reaches the take profit at 1.2950, you get a profit of 120 pips. However, if the price comes back and reaches the stop loss at 1.2790, your loss is limited to 40 pips.

Hence, while executing trades of GBP/USD on H1 using a breakdown of 1.2820 resistance, you can make a profit of 120 pips at a risk of only 40 pips if you correctly identify the breakdown and confirm it with volume.

#3. Moving Average Strategy

Moving Average Strategy is a well-known approach to uncover trends and entry or exit points. Moving Averages (MA) helps to smooth out market noise and reveal the general direction of price trends. 

Traders frequently apply this approach on RoboForex, because of the wide choice of indicators and trade automation and the availability of various terminals.

How Moving Average Strategy Works on RoboForex?

1. In order to understand the trend, analyze the market level on the chart. When the price surpasses the moving average, the trend is regarded as upward. However, if it is below, it is a downward trend.
2. A signal to enter the transaction is either the intersection of moving averages or the intersection of the price with the moving average.
3. Don’t forget that it is essential to set stop loss and take profit based on support and resistance levels.

Let’s consider an example of using the Moving Average Strategy on RoboForex. You would like to choose a MetaTrader 4 or 5 and trade EUR/USD pair with an H1 (1 hour) timeframe. You see that the current price is 1.1000. You’ve decided to set the SMA (Simple Moving Average) metric: at 50 and 200 periods, as well as the EMA (Exponential Moving Average) analysis tool: at 50 periods in order to have a faster response to price changes.

First, locate the signal on the chart. The SMA(50) crosses above the SMA(200), forming a ‘golden cross’. The price is trading above SMA(200), for example, SMA(200) is 1.0980. The EMA(50) is also moving up, confirming the uptrend. To validate the signal, you open a BUY position at 1.1010 — slightly above the crossover point.

Then, you set your stop loss at 1.0960 (50 pips higher than the entry-level) and take profit at 1.1110 (100 pips above the entry point). Accordingly, if the price reaches the take profit at 1.1110, you make a profit of 100 pips. However, if it drops to your stop loss at 1.0960, your loss is limited to 50 pips.

#4. Chart Pattern Strategy

Chart Pattern Strategy is a strategy based on recognizing and using repeating patterns on the chart. The behavior of market players creates these patterns, that can help predict future price movements.

On the RoboForex MetaTrader 4/5 platform, this strategy is especially useful thanks to charting tools like trend lines, support/resistance levels, and some indicators.

How Does Chart Pattern Strategy Work?

1. Traders should find one of the classic patterns (e.g. Head and Shoulders, Double Top, Triangle) on the chart.
2. After the pattern is complete, a user needs to open a position after the breakdown of a key line (e.g. neckline or triangle boundary).
3. Traders can use the pattern size to calculate targeted price levels.

An Example of Using Chart Pattern Method on RoboForex

Consider the following situation:

• You are trading on the GBP/USD pair.
• Timeframe: H4.
• Current price: 1.2800.

A Head and Shoulders pattern is forming on the chart: the left shoulder peaks at 1.2750, the head reaches a higher high at 1.2900, and the right shoulder forms a high at 1.2800. The neckline is a horizontal line connecting the lows between the shoulders and the head at 1.2650.

As you spot the pattern, the price falls underneath the neckline (1.2650) with rising market volume, which confirms the pattern is completed. After the breakout, you open a SELL position at 1.2640—slightly below the neckline to confirm the signal.

The trader needs to calculate the targets:

• The distance from the head to the neckline is 1.2900 – 1.2650, namely 250 pips.
• Take profit is set at 1.2650 – 250 pips = 1.2400.
• Stop loss is set above the right shoulder (entry point) at 1.2820 (slightly above the maximum of the right shoulder).

As a result, if the price reaches the take profit at 1.2400, you earn a profit of 240 pips. Meanwhile, if the price returns to the stop-loss at 1.2820, your loss is limited to 180 pips.

#5. The Alligator + Fractals Strategy

The Alligator + Fractals Strategy is a widely used trading approach that is more suitable for professionals and is built on Bill Williams’ indicators, including Alligator and Fractals. Traders use these tools to spot market trends, as well as entry and exit points.

This method is especially effective on the RoboForex platform thanks to MetaTrader 4/5, where all the necessary indicators are available.

How Does The Alligator + Fractals Strategy Work?

Let’s go over the main idea of this method. First, you need to assess the trend with the help of Alligator. If you aim to spot the start of a trend, analyze the line separation. The direction of the trend can be determined by the lines’ movement.

Next, use Fractals to find suitable entry points. To recognize an upward trend, you should look for descending fractals below the Alligator’s lips (green line) as a signal to buy. The downtrend is where you can see ascending fractals above the Alligator clip for selling.

It is also crucial not to forget about risk management. Be sure to set a stop loss behind the last fractal or key level. As for the take-profit value, it can be calculated using a risk/profit ratio, for example, 1:2.

Here’s an example of using The Alligator + Fractals Strategy on RoboForex. Let’s imagine you are trading the EUR/USD currency pair for one hour, and the current exchange rate is 1.1000.

By simply analyzing the chart, you can observe that the Alligator lines are beginning to move upward: jaw (blue line): 1.0950; teeth (red line): 1.0970; lips (green line): 1.0990. This confirms the initiation of an uptrend.

At this stage, a descending fractal is displayed under the Alligator’s lips (green line). At the same time, the price breaks this fractal from the bottom to the top, for example, at the level of 1.1010.

To confirm the signal, you open a BUY position at 1.1020, positioned slightly above the breakout level.

To minimize the risks, you need to set your stop loss at 1.0980, which is behind the last fractal, and set a take profit at 1.1100 to maintain the risk/reward ratio of 1:2.

In other words, if the price hits the take profit level at 1.1100, you will earn a profit of 80 pips. Still, if the price falls to the stop loss of 1.0980, your loss is limited to 40 pips.

The Most Suitable RoboForex Strategy for Beginner Traders

Above we’ve covered several of the most commonly used strategies, but if you’re a beginner, you’re probably wondering if any of them are right for you. Obviously, it’s essential for beginners to be able to understand the strategy easily, apply it effortlessly, and reduce risk.

Trend Following Strategy is one of those. It relies on the use of Moving Averages (MA), which are easy to understand and apply. In addition, it does not require complex tech evaluation. The strategy clearly shows entry and exit signals, which greatly simplifies the life of beginners. Finally, when you trade with the trend, you can minimize risks, because in that case, you would avoid counter-trend trades.

Additionally, this tactic can be used not only in Forex, but also when trading commodities, stocks, and other markets on RoboForex.

Finally, new traders lack experience, knowledge, and discipline. This method will help them develop discipline, as the Trend Following technique encourages it.

Final Thoughts

There are many trading methods in FX trading. If you need to find the best RoboForex strategies, you should study all the necessary trading terminals, available charts, and tools in order to settle on a more suitable one for your needs. In this article, we have detailed strategies that rely on charting tools, price behavior, and special indicators. It is preferable to thoroughly study all of the described strategies and apply them wisely, without taking risks and following the rules. Self-discipline, patience, and practice will help you start earning on Forex as soon as possible.

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