How Predictive Analytics and Big Data Can Increase Forex Trading Success

Are you thinking about getting your feet wet in the world of forex trading but you feel overwhelmed by the number of things to research about? All traders, brokers, and researchers go through this phase. Each trade involves someone making money and another losing it. Of course, you’d want to make the most out of your investment, but the risk proves too high especially if you don’t have a clue about market behavior. Thankfully, predictive analytics and big data allow you to glean useful insight about the market and make better trades.

Understanding How They Work

You might not realize it immediately, but predictive analytics and big data have been around for quite a while. Whenever you see the advanced statistics of your favorite NBA player, these two are responsible for those numbers. In the financial world, data can be used to make predictions of future market behavior. In many ways, forex trading has turned into a business of algorithms, behavioral shifts, and custom indicators.

Since the transfer of all trading markets to electronic platforms back in the 1990s, big data has started to perform its role of collecting information. This has amounted to a vast store of knowledge, which can now be integrated with predictive analytics to help minimize risks and maximize returns. In fact, automated trading software such as QProfit System now uses both predictive analytics and big data to make educated trading decisions for users.

Getting Quick Answers

One of the biggest benefits of leveraging these technological advancements is getting answers to your questions faster than ever. A prime example is scalping trading, which involves obtaining and holding a position for a very short time and then closing it at the right time to make a small profit. This process requires real-time information, which can only be provided by advanced analytics.

While studying historical patterns and trends still offer clues as to how the market might behave in the future, predictive analytics gives you an edge by accessing real-time data which you can use for short-term positions.

Eliminating the Dangers of Trading

Data-gathering tools aren’t perfect. Also, you have to consider the fact that gathered data can only be as useful as how they are analyzed. Regardless of these limitations, big data has proven to be immensely helpful in predicting future patterns of behavior in the foreign exchange market.

It’s now common for forex traders and brokers to trade based on predicted outcomes using datasets. Take note that this doesn’t mean forex trading has become a get-rich-quick scheme. The methods by which data is analyzed only reduce the level of risks involved in trading.


The digital era is largely powered by data. Despite its limitations, predictive models can still offer traders, brokers, and researchers an advantage by providing real-time information that assists in making informed trading decisions. But it’s best to master the ins and outs of the market instead of exclusively relying on modern tools in order to beat the limitations of the data.