Broker to Trading

These brokers offer Forex trading and a range of other markets. They are all regulated brokers supporting different types of trading, from non-automated trading to automated trading, all of which may be used by those who trade the Foreign Exchange Market. The site has given them a position from 1 to 10. These are suggestive positions, and the trader may check out brokers from the table and find out if they are suited for them, by creating a demo account.

Brokers offering support for both automated and self-directed trading may tend to score higher, but if the trader is only interested in self-directed trading, as many Forex traders are, then they might want to consider a broker that focuses on this kind of trading. One factor in choosing a broker is understanding Forex trading. So what is Forex trading ?

What is Forex trading ?

Forex trading is going long or shorting a currency pair, in the belief that it will rise or fall in value. There is normally a cost that is paid for by the spread (the difference between the buy and selling price) and, in some cases, a commission charge, which must be accounted for, along with other charges that might apply. So the aim is for the currency pair to rise or fall more than the cost in the desired direction. How far depends, to some extent, on the type of trading, whether short-term or longer-term.

Why is Forex trading hard ?

Why Forex trading is difficult can be seen even from examining a chart. The chart shows past movement in the price of the pair. It can be seen that pairs do not go straight up or down, instead, they tend to wave about, and even if they go up or down significantly, these moves are composed of moves called retracements in the opposite direction. However, it can be seen that there appear to be patterns in the way a Forex pair moves.

What are trading patterns ?

These are repeated patterns which can be seen on the chart. So given that there are repeated patterns, it might be expected that they will repeat themselves in the future.

Why is the future important in trading ?

Even in the spot market, where much Forex trading takes place, the future is important as the chart only shows the past. The present is the move actually being shown on the chart. The future is where the move will take place, whatever this is.

Why is it hard to predict what a move will be ?

It is hard to predict what a move taking place will evolve into, because at any time the market can move up down, or stay the same in value. Thus, each move has potential branches of possible futures. The key to trading is to prune some of those possibilities. The weight of repeating patterns can be seen as a way to do this.

However, the linear outcome is arguably only apparent when it is too late to get into the move. Thus, the trader has to speculate if they want to take advantage of a move or down. That is, they can be wrong.

Analysis, both technical and fundamental, aims to prune away possible outcomes and give some basis for deciding on a direction and a time to stay in the trade and when to exit. Fundamental analysis can be important to keep pn top of and understand what data may affect the way a Forex pair will move. This is particularly the case in news trading, but as with all trading, the expected effect may not be what happens.

Is technical or fundamental analysis accurate ?

It can be seen that this is perhaps the wrong question. Rather, it needs to be asked what this kind of analysis can do to suggest possible outcomes. However, regularities appear in the Forex market. These can be based on market conditions. That is, they can appear and disappear. These can help suggest possible outcomes, based on market conditions, rather than on what has happened in the past.

What are the online trading platforms ?

In order to trade Forex, the trader needs a platform. The brokers in the table offer different platforms. Most have MT4. This is a platform that allows both discretionary trading, where the trader makes their own trading decisions, and automated trading, where decisions are made by computer programs following rules. MT5 is a successor to MT4, which can offer an expanded range of features.

Some brokers provide cTrader and JForex. These are platforms that are suited to various types of Forex trading. Some brokers offer web traders and apps which may be designed for discretionary trading, by providing charting tools and a simplified layout.

What are the markets available ?

These brokers have a range of markets offered in addition to Forex. The approximate total number is given in the table. These are CFD brokers, thus, the trader does not own any underlying asset and is rather speculating on the price movement of the market.

Is it possible to trade Forex with 100 dollars or trade Forex with 50 dollars ?

Forex is a market where it has been possible to trade with smaller account sizes. This is because it allows small trade sizes, typically down to micro lots (0.01 lots). Since increasing leverage increases risk, the trader may wish to consider a broker with a Forex cent account, which allows even smaller trade sizes, if they wish to trade with a very small account size.