There are numerous types of Metatrader expert advisors out there to choose from. In this section we will mention the different types in the marketplace.
The most common element to Metatrader expert advisors is that they are mathematically based, and use different types of algorithms. Most Metatrader expert advisors are very flexible and can include different types of trading strategies such as hedging strategies, reverse martingale strategies and many more so some overlapping can occur between these categories.
There are three main classifications of Metatrader expert advisors: Classic expert advisors, advanced expert advisors and the third classification is divided to: news, breakout, hedge, and scalper and adaptive.
News based EAs – This type of Metatrader expert advisor is based on news announcements. The main idea is they attempt to capture profits based upon large spikes in price due to an economic announcement.
Scalping based EA – Scalping based systems are trying to capture small amounts of profit, often in frequent intervals. This is one of the most common Metatrader expert advisor types. You have to be careful though, not all brokers will allow scalping. Some of the Metatrader expert advisors that fall into this category have been designed to “hide” their pending orders so that the broker has no idea that a scalp is about to happen.
Breakout System – Some systems are based upon a break out of current consolidation, meaning that they identify when a price of a certain currency pair breaks through a specific support/resistance level and capitalize on them.
Hedging EAs – These types of systems open two opposing positions that are set to minimize the potential loss on the “wrong” one, and maximize the profit on the successful one. Many Metatrader expert advisor systems are based upon this kind of strategy, as hedging is one of the oldest strategies out there.
Adaptive EA – This is a new type of Metatrader expert advisors. The majority of the EA are based upon neural networks that give them the ability to process data “like” human traders and giving them the ability to react and adapt to different market conditions.
Support and Resistance EAs – These are the “classic” Metatrader expert advisor type, as they have been around the longest. They basically will buy at support areas, and sell at resistance areas. A lot of the Metatrader expert advisors in this category also employ trailing stops to maximize your profits.
Advanced EAs – These Metatrader expert advisors typically are capable of trading multiple currency pairs while simultaneously monitoring several different time frames. This gives the ability to recognize all layers of the trend, allowing the trader to take advantage of shifts in market behavior.
As you can see, there are a lot of types of Metatrader expert advisors you can choose from. You must remember that not all Metatrader expert advisor systems are the same. You will have to choose EA that will suit your trading needs.
We advise you to read the forex experts advisor reviews in our home page and run tests on the demo account of the expert advisor you choose.