A trading system can be defined as one of two things. First, a trading system can be a software program used to place trades and manage accounts. Second, a trading system can be defined as a strategy for entering and exiting the market. Whatever definition you first think, of one thing is for sure; there are plenty of trading systems to choose from.
Online broker/dealers will provide their clients with trading platforms. These programs will give the client all the necessary tools for trading. You will receive real time quotes for several currency pairs. Live up-to-the-minute charts will also be available through broker/dealer platforms. Account management features and instant profit/loss reports are also common features of trading platforms.
Though there are hundreds of different trading systems they all fall into three camps: bullish, bearish, and hedged. A bullish system is one where you believe the base currency will move higher. For example, if you believe the pound will appreciate against the U.S. dollar you would exchange dollars for pounds. You could use various technical tools--which create the many variations of bullish systems--to time your purchase. For the most part, however, a bullish system revolves around going long on the base currency. A bearish system is exactly the opposite of a bullish strategy. With a bearish system you want the base currency to decline in value. With the above example, you would buy dollars and sell pounds if you were bearish the pound. Like bullish systems, there are many technical tools that create variations of this strategy. Hedging is when you use counter trades or derivatives to mitigate risk in your portfolio. Hedging is a system commonly used by corporations involved with international trade.
