Odds are when you first stepped into the world of trading you will be bombarded with people providing/selling something called ‘signals’. You may have even used a signal provider in the past as many people often do and I even did when I first stepped into the world of trading and Forex.
Now I have many issues with signal services/providers a few being that the people selling the service for the most part are not real traders but marketers, their agenda is profit off the back off your losses but more importantly you don’t gain any real value or learn anything.
Whilst I could go on for a long time tearing down the issues with signal services for this article I am focusing on one issue that many people don’t think about at the time, which is that you don’t learn how to trade.
So, a signal provider will provide the following for when you join their service; What broker to use, how much capital to deposit, entries, stops and targets.
All you then need to do is wait for the provider to send you the trade details typically through a whats app group, telegram and so on. When you receive the trade details you just need to execute the trade with the info they sent you!
Sounds good doesn’t it…
Well whilst you may make some money in the short-term but more often than not you will lose money in the long-term as it is not in the signal providers own best interest for you to make money but rather lose money as that provider will get a commission on your losses through the broker they told you to trade with.
To also add more salt to the wound you are paying them a monthly fee for this outcome.
However the worst part is that if you are not learning how to trade by yourself through either investing into your own education by seeking mentorship or self-teaching then you are not learning how to trade.
A signal service does not teach you what is required to trade the markets, the process to find high probability setups and gain an edge over the markets
A lot of people think that while they are using a signal service they are a trader which at face value is true but the question is, does that individual know how to trade?
Anyone can open a broker account, follow a few simple directions to place a trade, rinse and repeat. But what happens when that signal provider disappears or decides they don’t want to provide signals any longer?
The signal provider is not there to teach you how to trade but simply give you directions on how to execute trades. You are never taught the process of how to find trade setups using technical analysis and again how to gain an edge over the markets or what that even means.
That brings me to the biggest problem with signal services which is they don’t teach you how to become independent in trading, as you are only making money whilst that person allows you to because when they disappear so has your ability to make any money if you are at all through trading.
That then means it is short lived and not sustainable because you have then three options.
1. Find a new signal provider as good as the last (If possible).
2. Invest into an education and learn how to trade.
3. Quit trading.
4. Blow your account by attempting to trade with zero knowledge, skill set or process to trade the markets with.
So, unless you go with option 2 all other options have an outcome of unsustainability when it comes to trading in the long-term outlook.
A lot of people don’t realise this though until after the fact and this is why we emphasise the importance of being an independent trader.
As of course your goal is to become consistently profitable but if you are dependent on someone else then you are at their mercy because you are letting that person dictate what trades you take, when you get involved in trades and because you don’t know their reasons behind the signals (Reasons of entry) you don’t even know what process they are using to trade the markets.
That is why we teach you how to think independently, as we give you all the needed knowledge and show you all the skills to trade the markets with but show you how to use all of it by yourself.
Independent thinking really comes when you take what we teach you and make it your own by making your own changes so that it suits your trading personality.
Our job here is to help you achieve the goal of knowing how to become consistently profitable but know how to do it on your own so that you are not dependant on us or anyone else for that matter.
When you can trade the markets with your own eyes, thought process and trading system whilst remaining profitable then at that point you have achieved something majority fail to achieve…Independence.
So, whilst you may experience some short term success through trading signals in the long term it is not sustainable and the truth is you are paying someone who is not teaching you anything so it would make more sense to just invest into your own education anyway. As you can then trade the markets freely instead of relying on someone else’s opinion when you don’t even know what they are doing at the other side of the screen.
Of course, we appreciate you are reading this whilst being a member here at F.E.T but this is just a reminder as to why signals are never the best way to trade the markets for long term success and instead you are doing is creating longevity to your trading career.
We hope that enjoyed this read!