A forex signal system is a collection of analyses used by a forex trader to decide if a currency pair should be bought or sold at any given time. Forex signal systems may be based on charting methods for technical analysis or news-based events. The currency trading method of the day trader is typically composed of a multitude of signals that work together to produce a decision to buy or sell.

Trading Forex signals are available free of charge, for a fee, or are generated by the traders themselves.

Executions that are either manual or automated can be generated by forex signal systems. A manual system requires a trader sitting on the computer screen, listening for signs and knowing whether to purchase or sell. The trader “teaching” the program what signs to look for and how to view them requires an automated trading system. Automated trading is thought to eliminate the psychological factor that is harmful to a lot of traders.

Other currency pairs, bond yields, commodity prices, and stock prices may provide signals. A day trader, for instance, may have a signal that their signal says they should sell a certain currency pair when a certain stock index trades through its 100 or 200-day moving average.