When you trade Forex via a mechanical system, you buy and sell based on a predetermined rule set. Some mechanical systems are very simple and have but a few rules and others. In either case, a mechanical system provides some advantages over a manual approach.
Mechanical systems can operate in an entirely automated fashion. The advantage here is that you never miss out on opportunities to buy and sell that meet your criteria for immediate action. Since no one can monitor the foreign exchange market 24/5, automation is a useful and powerful tool. In most real-world scenarios, such automation augments a manual system rather than be profitable on its own.
2. Pattern Detection
You can also benefit from mechanical trading as a means of detecting opportunities that may not otherwise be obvious. For instance, you could have indicators that follow particular patterns, such as crossover that overlaps with an oversold region.
Another great benefit of a mechanical system is that it can operate as a notifications system. Even if you’re monitoring the foreign exchange market manually, you can’t watch every aspect. However, you can have a set of rules that recognize scenarios and bring them to your attention.