Simplify your forex analysis with AI-driven automation
Introduction
Forex trading can be a complex process, requiring traders to constantly monitor market movements, execute trades, and analyze price trends. To succeed in such a fast-paced environment, automation is not just a luxury — it’s a necessity. But what if you could take it a step further and integrate a conversational AI tool like ChatGPT directly into your analysis process?
In this article, we’ll explore how to automate forex analysis using TraderMade’s ChatGPT Plugin, a game-changing tool for forex traders. TraderMade, a trusted provider of high-quality financial data, has recently launched a ChatGPT plugin that allows users to easily access their wide range of forex, crypto, and CFD data. With this plugin, you can effortlessly request real-time and historical data, set up automated technical analysis alerts, and track market sentiment — all through simple natural language prompts.
Without further ado, let’s dig deep into the plugin and explore how we can automate our forex analysis and streamline the whole trading process.
Setting Up the Plugin
Before we dive into automating forex analysis, let’s start by getting the TraderMade plugin up and running. Here’s a quick guide on how to install and configure the plugin for ChatGPT.
Step 1: Access the Plugin
To use TraderMade’s ChatGPT plugin, simply navigate to the ChatGPT Plugin Store within the ChatGPT app. Look for TraderMade’s plugin (Forex, Crypto, and CFD data) and add it to your account. You can find it here.
Step 2: Choose the Right Plan
TraderMade offers both free and paid plans. With the free plan, you’ll have access to a limited number of API calls per month, which is great for testing the waters. For professional traders or developers, TraderMade’s paid plans provide comprehensive access to data across major forex pairs, cryptos, and other markets.
Step 3: Set Up Your API Access
Once the plugin is installed, you’re ready to connect it to your ChatGPT environment. You don’t need to worry about authentication or complex setup — simply install the plugin, provide your API key (if you don't have one, create an account with TraderMade to get your free API key), and it’s ready to use.
Now, with everything in place, we can move on to automating various aspects of your forex trading analysis.
Automating Price Updates with ChatGPT
One of the key benefits of using the TraderMade plugin is the ability to receive real-time and historical price data for various currency pairs with just a prompt. This makes it incredibly easy to automate hourly or daily price updates.
Example Prompts for Price Updates:
1. “Give me the latest price of EUR/USD”
This prompt will instantly fetch the current price for the EUR/USD pair:
2. “What is the hourly (1 hour) price of GBP/USD for today?”
If you need a breakdown of prices by hour, this prompt will pull hourly updates for any currency pair:
By automating these price updates, you can focus more on analysis and less on manual data retrieval. In fact, you can set up a schedule where ChatGPT automatically gives you price updates for selected pairs every morning or at any specific interval you desire.
Analyzing Historical Data
One of the key features of TraderMade’s ChatGPT plugin is the ability to access and analyze historical forex data. While the plugin doesn’t directly provide historical data in the form of a table or chart automatically, it can be prompted to display the dataset in a CSV format or plot it, making it easier for traders to review price trends and patterns over time.
This capability is crucial for understanding long-term market movements, identifying trends, and performing backtesting to validate trading strategies. Let’s walk through an example of how to prompt the plugin to display historical data and analyze key insights from the charts.
1. Visual Format
One of the key features of the TraderMade plugin is the ability to visualize historical data for any currency pair. This makes it easier for traders to understand the overall market trend and spot patterns.
Example Prompt:
“Give me the historical data of EUR/USD from 2024–06–01 to 2024–10–01. Plot the entire dataset.”
Upon execution, the plugin retrieves the requested data and displays it as a chart, as shown below:
2. CSV Format
In addition to visualizing historical data, the TraderMade plugin allows users to export data in CSV format. This is particularly useful for traders who prefer to analyze data in spreadsheet tools like Excel or perform custom analyses using Python or other programming languages.
Example Prompt:
“Give me the historical data of EUR/USD from 2024–06–01 to 2024–10–01 in downloadable CSV format.”
With this prompt, the plugin will generate a CSV file containing the historical data for EUR/USD, which can be easily downloaded. This data can include opening, closing, high, and low prices, as well as any other relevant metrics provided by the API.
Here’s the exact response given by the plugin for the sample prompt:
Upon clicking the link, the plugin automatically starts downloading the CSV data. This feature to export CSV data helps traders perform more in-depth analysis, compare currency pairs, or even backtest their trading strategies using historical price data.
Calculating Technical Indicators
Technical indicators are essential tools for traders looking to understand market trends and make informed decisions. With TraderMade’s ChatGPT plugin, calculating these indicators becomes a simple task, involving just a few prompts.
1. Single Indicator Calculation
The plugin allows you to calculate individual technical indicators like the RSI, moving averages, and Bollinger Bands with ease. Let’s take a look at a few examples.
Example Prompt:
“Calculate the 14-day RSI for this data and plot it in a separate panel below the closing price data.”
The plugin processes the request and calculates the Relative Strength Index (RSI) for the historical data. It then plots the RSI in a separate panel, providing a clear visual representation of momentum changes relative to the closing price. The output looks as follows:
Another Example:
“Calculate SMA 5, 8, 20 for the historical data and plot it. Each line has to be in a different color.”
The plugin calculates the Simple Moving Averages (SMAs) for the specified periods and overlays them on the closing price chart. Each SMA is represented by a different color, making it easy to visualize the short-term and long-term price trends. This is the resulting chart for the given prompt:
2. Multiple Indicators on Different Panels
The plugin can also handle multiple technical indicators simultaneously, plotting them on different panels for better readability.
Example Prompt:
“Calculate 12-day Bollinger Bands and 8–17–9 MACD for the historical data and plot it. Drop the null values before visualizing and include the MACD histogram.”
In response, the plugin calculates the Bollinger Bands and MACD for the historical data and plots each indicator in its own panel. This allows traders to easily spot overbought/oversold conditions, volatility changes, and potential trend reversals.
The following chart is the output for the above-mentioned prompt:
3. Consolidated CSV Data
If you need all the calculated technical indicators consolidated for further analysis, you can request the plugin to export them in CSV format.
Example Prompt:
“Give me all the calculated technical indicators along with the closing price data in downloadable CSV format.”
Output:
As can be seen from the output, the plugin provides a link to download the CSV file that includes all the calculated technical indicators along with the closing price data, which can then be used for more advanced analysis or strategy development.
Backtesting Trading Strategies
The ability to backtest trading strategies is crucial for understanding the viability of a trading plan before applying it in live markets. With TraderMade’s ChatGPT plugin, you can backtest a variety of strategies using historical data and technical indicators.
1. Single Indicator Strategy
In this example, we use a straightforward strategy based on a single indicator, the RSI (Relative Strength Index). The plugin helps backtest entry and exit points defined by the RSI values.
Example Prompt:
“Backtest a simple strategy on this data. Enter the market if RSI < 40 and exit the market if RSI > 60. Calculate the returns of this strategy and compare the strategy’s performance with buy/hold returns.”
By simulating the trades based on these conditions, the plugin calculates the returns and compares them with the buy-and-hold strategy, providing a quick evaluation of the strategy’s effectiveness. Here’s the response given by the plugin:
2. Multiple Indicators Strategy
This approach uses a combination of two indicators, RSI and SMA (Simple Moving Average), to refine entry and exit signals for trades. Using multiple conditions increases the specificity of trades, allowing for potentially more reliable outcomes.
Example Prompt:
“Let’s backtest another strategy. Enter the market when RSI < 50 and SMA 20 is greater than the closing price. Exit the market when RSI > 50 and SMA 20 is lesser than the closing price.”
The plugin evaluates both indicators before entering or exiting a position. It then calculates the returns based on these conditions, showing traders how combining indicators can enhance strategy performance. Here’s the backtesting result of the strategy calculated by the plugin:
3. Series of Strategies
Backtesting multiple strategies simultaneously helps traders identify which approach works best for a particular asset. In this section, we backtest a series of five different strategies, each with unique entry and exit conditions.
Example Prompt:
“Backtest a series of strategies, show the returns of each strategy, and choose the best performing one.
1st strategy: Enter the market if SMA 5 > SMA 8, exit if SMA 5 < SMA 8.
2nd strategy: Enter if SMA 20 > closing price, exit if SMA 20 < closing price.
3rd strategy: Enter if RSI < 30, exit if RSI > 70.
4th strategy: Enter if closing price < lower Bollinger Bands, exit if closing price > upper Bollinger Bands.
5th strategy: Enter if MACD > MACD signal, exit if MACD < MACD signal.
Compare each of the strategy’s returns with buy/hold returns.”
The plugin processes each strategy individually, calculates returns, and compares them with buy-and-hold returns. Finally, it highlights the best-performing strategy based on historical data, helping traders decide which one to use for live trading. These are the results of each strategy according to the plugin:
Conclusion
In this article, we explored how TraderMade’s ChatGPT plugin can automate various aspects of forex analysis via their Forex API, from obtaining real-time price updates to calculating technical indicators and even backtesting trading strategies. The plugin simplifies the process for traders, allowing them to access critical data with just a few prompts and removing much of the manual effort involved in the analysis.
While we explored the plugin’s potential with examples of single and multi-indicator strategies, the real value lies in how easily you can adapt it to your unique trading needs. Whether you’re looking to perform detailed technical analysis, fetch historical data, or automate strategy backtesting, the plugin offers a flexible solution for traders of all levels.
With that being said, you’ve reached the end of the article. Hope you learned something new and useful today. Let me know your thoughts on this incredible plugin in the comments. Also, I suggest reading TraderMade’s blog to learn more about this plugin. Thank you very much for your time.
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