Best Trading Signal Providers In 2024
Available from a range of brokers and third-party providers, signals are a popular trading tool, providing a prompt to buy or sell a particular asset.
This guide ranks the best signal providers following our hands-on tests. We also explain how to choose trading signals and how you can incorporate them into your strategy to improve your understanding and performance.
Best Brokers With Trading Signals
Alternatively, for traders who want signals that can be used with any broker, these 3 independent providers impressed our experts:
Best Independent Signal Providers
Comparing Signal Providers
Comparing signal providers can be challenging, especially with the level of misinformation out there. That’s why we, and you, should consider the following factors when selecting a provider:
Safety
Prioritize the safety and reliability of signal providers as you would when choosing an online broker.
We’ve found that not all signal providers have the same expertise, and many firms lack regulation from trusted bodies like the UK Financial Conduct Authority (FCA) or Australian Securities & Investments Commission (ASIC), making it challenging to identify trustworthy companies.
The rationale behind the limited regulation of signal providers stems from their lack of access to customer portfolios. Often operating anonymously, these services do not establish a conventional customer/provider relationship, exempting them from being classified as financial services providers similar to brokerages.
Still, the absence of regulatory oversight increases the risk of falling victim to scams, with instances of commission scammers targeting investors being reported.
For example, several thousand young traders subscribed to a WhatsApp group for regular messages with updates on assets and trading opportunities, many of whom lost considerable sums.
- ThinkMarkets is a trusted broker that provides access to Signal Centre, which stands out as a regulated signalling platform under the UK’s FCA.
Performance
Evaluate signal providers based on their historical performance.
The top providers publish reports highlighting signals’ success over a period. Consider elements such as how many signals were published, which assets the provider has distributed the maximum number of accurate prompts, and how profitable these ideas have been.
Importantly, we recommend reviewing historical performance over a longer period, for example a year, as unexpected price volatility may blur an outlook.
Be careful, though, as some providers may doctor their results to try and entice new customers. See if reviews match up to the claims made by the firm to be safe.
- Forex.com excels with its user-friendly dashboard that shows the performance of signals with a hit rate out of 10.
Cost
While the most affordable trading signals might be appealing, you must recognize that cost often correlates with quality.
We’ve observed that free signals, while not always the case, frequently originate from untrustworthy sources with hidden agendas.
Many signal providers opt for a monthly subscription fee rather than a one-time (lifetime) usage charge. These fees can range from $10 per month to exceeding $500. Some brokers, however, may cover these costs for retail traders.
We recommend checking the forecasted (or historical) performance of a provider and apply it to your account capital to see how much you will be able to afford and whether a more expensive service will be worth it.
- IG is a broker I personally use and it offers complimentary trading signals on forex, index and commodity markets to registered clients. There is no extra cost to act on signals.
Markets
Choose signals based on your preferred market, trading session, or even diversify across multiple markets to align with your trading strategies and risk preferences.
Trading signals can offer insights into potential trading opportunities in individual stocks, forex, cryptocurrencies like Bitcoin and Ethereum, commodities such as gold and oil, and derivatives like CFDs.
- City Index offers a top-rate solution called SMART Signals, which scans 36 global markets across hundreds of thousands of data points to find daily trading opportunities.
Alerts
Select a provider that distributes trading signals through a convenient contact method, such as SMS.
If you are happy receiving signals through whatever means, then this may not be a massive issue. However, some traders may not want to provide their email address or mobile number to a signals provider, instead preferring another contact method.
If you are looking for maximum ease of use or automated execution, filter through trading signals providers by requiring that they integrate with your trading platform. This can be done directly or through an API offered by the firm, though this may require a little extra work on your end to set it up.
- 1000PipBuilder routinely shares trading signals through Telegram, email and SMS.
5 Tips For Choosing Signals
Once you have chosen a broker with trading signals or an independent platform, consider our 5 top tips when choosing individual signals:
- Look for signals with a proven history of account growth, as this will greatly impact the success of your trades.
- Gain a comprehensive understanding of the methodology behind the signals to ensure they align with your trading goals and risk tolerance.
- Evaluate how the trading signals manage risk by considering the risk-reward ratio, stop-loss mechanisms, and overall risk management strategies embedded within the signals to safeguard your capital.
- Determine if the signals provide real-time analysis, as signals that offer current and relevant information will be more valuable for making informed decisions.
- Assess whether the signals can be customized to suit your trading preferences and if they’re compatible with your chosen trading platform.
What Are Trading Signals?
Trading signals are indications or alerts generated by either human analysts or automated systems (using algorithms or AI) that suggest potential entry or exit points for trading financial assets.
Trading signals provide quick insights into potential market opportunities, allowing you to act promptly on identified signals without spending extensive hours studying charts and market data.
Signals are usually based on technical analysis, fundamental analysis, or a combination of both, aiming to guide you in making informed decisions.
They can be derived from various sources, such as price patterns, moving averages, volume trends, market sentiment, economic indicators, or specific mathematical algorithms.
Trading signals aim to identify opportunities where the probability of a successful trade is deemed higher based on historical patterns or current market conditions.
These signals typically specify:
- Asset & Timeframe: The asset (stocks, forex, cryptocurrencies, etc.) and timeframe (daily, hourly, etc.) the signal applies to.
- Entry Points: Suggested levels or conditions at which to enter a trade (buy or sell).
- Exit Points: Indications of when to close a trade to secure profits or limit potential losses (take-profit or stop-loss levels).
How Do Trading Signals Work?
Here’s a breakdown of how trading signals typically function:
- Data Collection & Analysis: Signal providers gather and analyze market data from various sources. This includes price movements, volume trends, chart patterns, moving averages, support and resistance levels, and possibly news or fundamental indicators related to specific assets or markets.
- Signal Generation: Based on the analysis, predefined criteria, or algorithms, the system generates signals. These criteria could involve specific technical indicators crossing certain thresholds, trend confirmations, or patterns emerging on charts (e.g., head and shoulders patterns, moving average crossovers).
- Delivery: Signals are then distributed to signal subscribers through various means. This could be via email, SMS, mobile apps, or within trading platforms. Some signal providers offer real-time updates, while others might offer periodic updates based on market conditions or preset time intervals.
- Interpretation: When receiving these signals you should evaluate them alongside your own strategies, risk tolerance, and market understanding. You should assess the credibility and relevance of the signals before deciding whether to act upon them.
- Execution Of Trades: Based on the received signals and your own assessment, you can execute trades or not. Signals often specify entry points (buy/sell), exit points (take-profit, stop-loss), and sometimes even recommended position sizes.
- Continuous Monitoring & Adjustment: You should monitor the market and adjust your positions based on how the market evolves. This includes managing trades by adjusting stop-loss levels, taking profits, or exiting positions if market conditions change.
It’s important to note that while trading signals can be valuable tools, they’re not foolproof. Market conditions can change quickly, leading to unexpected results.
Treat signals as a supplementary tool rather than an absolute directive.
Bottom Line
Utilizing trading signals can offer a beneficial avenue for capitalizing on gains, but it’s crucial to acknowledge that profits aren’t guaranteed.
These signals amalgamate technical, fundamental, and quantitative analyses to predict and forecast market or asset movements. Yet, these forecasts don’t always materialize, necessitating robust risk management systems. Furthermore, numerous scammers target inexperienced traders with misleading signals.
Nevertheless, following our guidelines above can help you get started with trusted signals providers and minimize associated risks.
FAQ
What Is A Trading Signal?
A trading signal is an indicator or notification that suggests potential entry or exit points for trading assets.
These signals, generated through technical or fundamental analysis, aim to guide you by forecasting market movements and providing insights on when to buy or sell assets based on predefined criteria or algorithms.
Are Trading Signals Legal?
Yes, trading signals are generally legal. They are essentially market analyses or recommendations provided by individuals, analysts, or automated systems, which are legal means of conveying information and strategies to assist you in making informed decisions.
However, the legality might vary based on the region and compliance with financial regulations governing investment advice and services.
Do Trading Signals Work?
While some providers offer decent returns, no trading signals work 100% of the time. If a company is claiming this, run and do not look back.
How Do I Get The Most Out Of Trading Signals?
Generally, you can filter the signals that you receive with a large number of variables. For example, you could specify the assets for which you are notified of opportunities.
You can also limit the timeframes over which the signals should require a position to be open. Shorter-term day traders and scalpers may request one or five-minute signals, while others may prefer hourly or eight-hour chart notifications.
Who Gives The Best Trading Signals?
Determining the ‘best’ trading signals provider is subjective and can vary based on your individual preferences, accuracy, and compatibility with trading strategies.
Some well-regarded sources include professional analysts, reputable financial institutions, and established trading signal platforms with a track record of accuracy and reliability.
Researching and trialling various sources will help you to identify the most profitable signals for your specific trading styles and goals.
Why Do Providers Give Free Signals?
Signal providers often offer free signals to attract followers, build credibility, or as a marketing strategy to promote premium services or products.
It’s a way for signal providers to showcase their expertise, gain a larger audience, and potentially convert free users into paying subscribers for more advanced or exclusive signal offerings.
What Are The Benefits Of Using Trading Signals?
You can use trading signals to enhance decision-making and save time through pre-analyzed market insights, complementing existing strategies.
You can access expert analyses, remove emotional biases, and use signals as a learning opportunity to improve strategies and gain insights into market dynamics and technical analysis.
What Are The Risks Of Using Trading Signals?
Using trading signals carries risks, including potential errors or inefficiencies, and reliance on historical data may not adapt well to sudden market shifts or unexpected events.
Additionally, subscription costs, overdependence without understanding underlying analysis, and lack of customization to individual preferences or trading styles can further pose challenges.
Should I Act On A Trading Signal?
When you retrieve a trading signal, it is up to you whether you follow through with the suggestion.
Some traders might assess the perceived risk (usually included in the notification) as too high or have carried out their own fundamental or technical analysis that leads them to believe the signal may not be successful.
If you have unwavering faith in the signals that are sent to you and use a program that integrates with your platform, you can automate your response. This will mean that there is less delay between the opportunity being recognized and the position being opened, likely improving the extent of any profits that are made.
However, if you implement this, you will not be able to reject signals on a case-by-case basis.
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