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01 Oct 2019
5 min read

Forex Trading and Artificial Intelligence

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Written by OspreyFX News Team

Artificial intelligence is all the rage these days and has begun to infiltrate every sphere of our lives. From shopping patterns to more personal decisions, AI bots are being used by large companies to increase their sales as they get to know more and more information about their customers. This is also happening in the trading world in general, as trading bots are proliferating by the thousands to assist those who are perhaps slightly greener than others in this highly competitive market.


Online forex trading reaches new highs.

As AI is continuously evolving , so is the world of online forex trading. The first online forex trading platform was launched in 1996, allowing the participation of the first online retail traders inside the largest market in the world. More than twenty years have passed since the introduction of the first online trading platform, and retail forex trading now represents a daily turnover of $282 billion.

With the purpose of creating the ultimate forex experience for traders, both technologies merged in 2018 and, as result, many forex brokers identified the potential of AI to enhance the world of mobile trading.  It’s clear that integrating AI and the dimensions in which it can improve online forex trading, will set new standards inside the industry. But how exactly will this influence today’s trading structure?

AI and forex trading main pic

Customised trading experience – mobile trading.

2018 saw forex brokers putting a lot of effort into mobile trading. Several brokers actually built their own mobile apps which allowed them to deposit, withdraw and also track profit. It’s difficult to choose an app however with the proliferation of these on the market and to make a proper assessment of each and every apps’ capabilities.

This is where AI comes in and can be a game changer in the field of mobile trading. There is strong recognition amongst traders that AI can transform the mobile trading app in various ways. These may include the possibility of having a trade analysis that’s personalised to proper financial and trading education.


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Opportunity to predict analysis.

Several Trading firms are evaluating the chances AI has to predict market fluctuationss. The Nikkei index used Artificial Intelligence to come up with a prediction for the JPY-USD Exchange rate. The results were quite startling as the AI bot was extremely accurate and much more to the point than the result achieved by a top analyst.

Other studies have shown that AI can predict correct values around 80% of the time over a week. Including the potential to predict volatility and how many traders will be able to make their decisions with a formulated idea on what the markets will look like. It’s an option worth considering for forex brokers. AI inside the forex industry is just starting, meaning that AI has still a lot of development and advances coming it’s way.

Potential for lessened risk

Artificial intelligence also has the capacity to reduce risk. There’s the possibility of automatic stop loss orders where you set the level that you want your trade to close. AI can definitely play a part here. Trader emotion which can have an effect on decisions that are hasty are eliminated by a proper AI trading bot.

Additionally, there are other factors that may affect trading decisions. These include fake news, political news and other situations such as natural disasters. With the use of AI, traders can be in a better position to anticipate the market without the volatility caused by external effects.