Ever heard of the Forex Metatrader 4?
For foreign exchange (also known as Forex) traders, Metatrader 4 shouldn’t be strange; it’s a software platform that traders more likely have on their computers and laptops.
So what really is the Forex Metatrader 4?
The Gist of the Metatrader
Forex MetaTrader 4, also known as the MetaTrader 4 or MT4, is an application developed by Metaquotes Software Corporation. It is a Windows-based application released in 2005 that assists in providing brokerage services to traders, not only in Forex, but also for Futures and CFD markets.
MT4 includes both front-end terminals and back-office components. Having said so, MT4 gives you the whole package in starting your brokerage business. This software is built for everyone because it has multi-language and multi-currency support – giving it reliability, performance and security. The server for MT4 can process dozens of several financial instruments with records of previous trading histories.
MT4 is made up of six components:
With MetaTrader 4, trading opportunities can be increased, and are always present. It can help traders manage and stay connected with their trading accounts even when they’re always on the go. Multiple accounts are even maintained without any difficulties.
If you’re a foreign exchange trader, it would be very helpful to have Forex MetaTrader 4 with you. You don’t have to spend to get the service – you can get it free of charge, yet you get so much more in return. You can trade whenever and wherever, according to your terms.]]>
Guest post by FXCC Forex Trading Blog]]>
The forex trade and exit rules can be based on simple conditions like a moving average crossover or complex strategies requiring a thorough understanding of the programming language that is specific to the trading platform of a user. These trading systems usually work by using software that is linked to a direct access broker. It is essential for any specific rules to be written in the proprietary language of a particular platform. For instance, the NinjaTrader platform uses the NinjaScript programming language.
Some forex trading platforms feature strategy building wizards which make it possible for users to select from a list of technical indicators that are commonly available for the purpose of building a set of rules that can then be traded automatically. For example, a user can establish that a long trade can only be entered after the fifty-day moving average crosses above the 200 day moving average on a 5-minute chart of a certain trading instrument. After trading rules are established, the computer is able to monitor the forex market to find sell or buy opportunities based of the specifications on the trading strategy.
The benefits of using automated forex trading systems include the following.
Minimize emotions – The emotional factor is one of the things that lead to failure in forex trading. Automated forex trading systems keep emotions like fear and greed in check throughout the trading process. This allows traders to have an easier time as they trade and the yare therefore able to stick to their plans. Trade orders are executed automatically after the trade rules are met. This means that it is impossible for a trader to question or to hesitate making a trade. An automated trading system is helpful for forex traders who overtrade and those who are usually afraid of making trades.
Gives a trader the opportunity to backtest – This system applies trading rules to market data that has been recorded in the past to determine if an idea is viable. When an automated trading system is being designed, it is essential for all rules to be absolute, without any room for interpretation. As a trader, you can take these precise sets of rules and then test them against historical data prior to risking your money in forex trading. With careful backtesting, you can evaluate a trading idea and then fine tune it.
Preserve discipline – Automated forex trading systems preserve discipline even in volatile markets since trade execution is performed automatically and the trade rules are established. These systems also help to ensure that traders maintain discipline since they will follow the trading plan completely. They also minimize pilot error.
Consistency – Planning a trade and trading it as expected is challenging for many forex traders. Even if a trading plan has the potential to earn you’re a profit, you can alter its profitability if you fail to follow all the rules. No trading plan can win 100 percent of the time and this means that losses are part of forex trading. However, losses can cause psychological trauma and if you lose 2 to 3 trades consecutively, you may decide to skip the next trade. This can easily destroy the expectancy that the system had. An automated trading system allows you to achieve consistency in your trades by trading the plan.
Fast order entry speed – Computers respond to changing market conditions immediately and for this reason, automated forex trading systems can generate orders immediately after trade criteria are met. This is beneficial because a big difference in the outcome of a trade can take place if you get in or out of a trade a number of seconds earlier.
Diversify trading – With an automated trading system, you can trade multiple forex accounts or use a number of forex trading strategies at once. This allows you to spread risks over various instruments as you create a hedge against losing positions. You can be able to accomplish what is completely challenging through self directed trading since the computer can scan for trading opportunities over a wide range of markets, monitor trades and generate orders.
The downsides to using automated forex trading systems include the following.
1. They are prone to mechanical failures.
2. They require monitoring.
3. Over-optimization can take place.
Automated forex trading systems are appealing for many reasons and you can use them to complement carefully executed forex trading. This will increase your chances of earning a profit in your trades.]]>
Demo accounts are very important. All the theoretical information and forex trading in the world will not be able to help as much as a mock trading situation. Playing with foreign exchange currencies and contracts, then watching how the account balances are affected by different factors on a demo account is important. Using this method will help you learn the system quickly and has been proven to be the fastest method to beat the learning curve. At the same time, it will give you an idea of what to expect.
Demo accounts are also considered to be the best way to train as you can learn from your mistakes without risking a single cent. Additionally, you can be able to have an indication on whether forex trading is the right path for you to follow.
Analytical Data and Charts
At first, the sheer volume of analytical information handed to forex trading individuals seems to be quite intimidating. Keep in mind that it is all there for a reason. Using the information you have been provided about particular currencies is quite simple. This can only be done when you have received trading that will help you get the hang of it.
You need to learn how to decipher a chart and analytical data. Once you have learned to do the same, you will need to know how you can convert that training into a viable strategy. This strategy should be able to increase your chances of placing and maintaining winning trades. At the same time, this is the information that will help you minimize your losses in the event that the market decides to move against you. This is a very important part of forex trading and should be taken seriously.
Training and Courses
It is very possible for a new trader to start trading the foreign currency market without any training. Such a person can also be able to make some profits. This move is not always advisable. To some people, forex trading may seem to be something that is quite straight forward. The forex market is not like any stock market as it is very large and is known to be volatile. If you enter this market without training, you will be risking a lot. Using forex trading training will help you minimize your losses by creating a realistic approach.
Leverage and Margin
A good number of forex based contracts are drawn up using a large portion of money borrowed on margin and a small portion of your own money. Forex trading training is the only way you can learn how this type of high leverage will have on your trades. Having the training will help you make the best of it during your trading endeavors. Without the training, you are likely to loose a lot of money when you trade.
A good number of forex brokers will offer a form of margin for the contracts you have written. Make sure you have always checked the ratio of your own money that will be used in each contract you have placed. At the same time, you should look at how the leverage of this kind can be able to marginally increase your profits. When you have undergone forex trading training, you can be able to see and know how you will be controlling a substantially larger amount of money than the actual amount you spent from your own account.
Keep in mind that the leverage will have a similar magnifying effect on any of the losses you incur. To minimize these losses, it is highly recommended to search for the best quality training. Since there are a large number of forex trading training resources available, make sure you choose one that will suit you best.]]>
Fibonacci Forex Strategy
One of the most amazing things you will discover when trading Forex is how abstract concepts, which seemingly have no connection with Forex at first glance, are often extremely powerful tools to make a profit from the market. One of these tools is the series of Fibonacci numbers. Fibonacci numbers are used by some of the World’s top traders to calculate the optimum prices at which to buy and sell. It sounds far fetched at first, however, when you see how profitable it works out for many you will soon want to add the Fibonacci numbers to your trading strategy.
Fundamental Analysis Strategy
A very common traditional FX trading strategy is to use Fundamental Analysis to try and work out what is going on in the economy and how it is likely to affect the particular currency pair you are currently trading. This involves looking at the currency’s economy including debt levels, interest rates, unemployment, the political situation and much more, to try an determine as accurately as possible how a currency’s price is likely to move. This is quite labor intensive, however, over time if you employ this one strategy you will begin to intimately understand a currency pair and see why moves happen, which will ultimately help you better predict the future price.
Risk Management Strategy
Every trader, as a fundamental tenet of Forex trading strategies, needs to have a risk management strategy. No matter how good a trader you become there will always be times when you lose in any given trade. The key is to have a risk management strategy in place which limits your losses to a small amount and maximizes your wins. One of the most popular Forex trading strategies for dealing with risk is to limit every trade to no more than 3% of capital. The best traders, namely those that trade full-time for a living, never risk too much of their capital on any single trade. Neither should you. If you gain one thing from this article, make sure it is the necessity of having an effective risk management strategy in place.
Support And Resistance Strategy
Many beginner Forex traders use this as their sole initial strategy. The basic principle is to use technical analysis to determine the historical support and resistance lines for any particular currency pair. Then the key strategy is to buy low and sell high at all the pre-determined points within the channel. Of all the Forex trading strategies this is one of the simplest, however, it is mightily effective, perhaps because of its very simplicity. The key is to apply the strategy with discipline.
Stop Loss Strategy
Every beginning Forex trader should have a stop loss. In the early days, especially, when you don’t fully understand the market and what’s going on it can be very easy to lose an absolute fortune. You want to avoid this at all costs. Your best friend in achieving this is a little tool called a stop loss. It is an automatic order to sell when the currency drops below a particular level. It shields you from terrible huge losses which can end up bankrupting you. Of all the Forex trading strategies you will learn this is one of the most basic and yet more important.
Traders aspiring to trade full-time soon find out that trading real money in the market tests their emotions and psychology far more than they imagined. To overcome this it is important to decide, before emotions kick in, when to buy, when to sell and what your overall strategy is.
There are literally hundreds of Forex trading strategies that you can learn. While mastery of these will obviously require further dedication and rigorous study, the outlines listed here will serve you well if you remember and apply them.]]>
As I said before these are all great forex brokers and you will be happy with any of them but depending on your circumstances one maybe a better fit for you than another. This list was also put together exclusively for US customers .
MB Trading has a number of advantages when it comes to forex brokers. One of the most important is there EXN network. Which provides very low spreads ranging from 1 to 1.2 pips on most of the major pairs and 2 pips on select majors like the GBP. MB Trading has 8 different trading platforms to choose from including the most popular MT4 platform. Other useful information is there is a $400.00 min deposit with three base currency available(EUR,GBP,USD). They have a min. trade size of one micro lot and maximum account leverage of 100:1. All with a non-dealing desk environment. Learn more and open an account here.
FXCM also offers a non-dealing desk trading environment for forex traders. FCM spread are also very competitive weighing at 1.4 to 1.6 on major pairs. FXCM has a smaller min deposit of 50 dollars and a higher account leverage of 200:1. They offer 7 different trading platforms including the MT4 platform. Base currency pairs are AUD,CAD,CHF,EUR,GBP,JPY,NZD,and USD providing a wider options there. Its min trade size is also 1 micro lot. Check them out and open an account here.
Etoro is a little bit different than the above two where as it includes the community aspect of forex trading. In this social trading environment you can see what other forex traders are trading and gains. You can actually copy they trades as well. This is also provided in non dealing desk environment and has low spreads. If you’re looking to learn and interact with other traders this may be a viable option for you. Check out their site here.
And last but not least, we have Tradestaion. Tradsation is more for advanced, experienced and serious traders. Their trading platform is top of the line. First it has dynamic screening and chart pattern recognition that allows you to be constantly scanning for opportunities that fit your criteria. The order execution is flawless and lighting fast with advanced features such as market depth. They are also not limited to just forex you can get direct access data from just about every source including: NASDAQ Level II, NASDAQ TotalView, NASDAQ OpenView, Bloomberg, BATS, Direct Edge (EDGA and EDGX), and ARCA providing you with massive liquidly. Best of all they have a 60 trial where you can test out the trading goodness for free. Try them out by clicking here.
Throughout the history of business traders seek to make a profit; this applies to forex brokers who have to realize profits for their clients. In order to achieve this forex brokers adapt several methods. These practices must be deemed fair by the clients so as to maintain the reputation of the money market and keep the traders happy. Generally brokers provide services that allow ordinary traders with $10,000 to speculate in the up-until recently money market.
These forex brokers usually take the opposite side of trade as they initially attempt to match your order with other clients. The dealers generally make their profit based on the spread of the trade. If there is a two pip spread in the USD/JPY market but the dealer give 4 pip spread instead this means he/she pockets 2 pips for acting as your trade facilitator. A general rule requires that there are no extra costs in the trading with such forex brokers. There is always a certain level of risk in circumstances where forex brokers manipulate the market thus slipping you on fills however such practices are becoming less common as regulators crack down on unscrupulous dealers.
These dealers are also known as actual forex brokers. ECN stands for Electronic Communication Network and enables traders to electronically match with other traders. These forex brokers never go on the opposite side of the trade. This means that if your bid on the EUR/JPY is at 1.4056 but do not get a seller there you simply win and get filled since there is no trader available to sell it off to you at that price. Although this is rare it is not uncommon.ECN forex brokers always want you to make profit from your investment so that you can always trade with them as they make their commission from the fee charged for each trade. As a result no markup exist in the spread to compensate these forex brokers, typically you will have tighter spreads however there will be extra transaction fees in the form of commissions for conducting your trade.
Margins usually vary from country to country and broker to broker. Recently the US brought down allowable leverages for their citizens to trade. Due to these regulations US forex brokers only allow fifty to one leverage which means that a trader will have to place 2 percent of the trade value for margin. The same rules lowered liquid trade to 20 percent which means that 5 percent margin figure is required. When this is contrasted with countries around the globe that enables unlimited leverage you can see that this can go up to 700 – 1 indicating that margins requirements usually depend on the forex brokers you choose to conduct your trade.
This should be the number one priority of every trader since the safety of your deposits as well as the honesty of the chosen forex brokers is paramount. Traders who fail at this stage ultimately end up miserable. Financial analysts recommend that traders should ask questions and conduct some background research before handing their hard earned money to forex brokers.
Customer care has become an important aspect when conducting business in modern times. It is important to note that forex brokers need you more than you need them. If there is no clear way of contacting the dealers at the brokerage website then walk away as this indicates that something is fishy. Most professional forex brokers use different platforms to enable potential clients to contact them such as live chats, emails and phones. Credible forex brokers often have a disclosure statement in the ″About Us″ section of their website stating their membership to the relevant regulating authority.
When choosing forex brokers to conduct your trade it is important to identify dealers who are well capitalized. Forex brokers who have problems with capital can be risky to invest with since they can easily lose your money. This trend was very common even in the US where firms would have less than $100,000.Fortunately the US has enacted tough laws to protect traders from loosing their hard earned money but this may not be the case in some countries. If you are operating in such countries it is important to conduct some basic research to avoid committing your money to unstable forex brokers.]]>