Forex trading is one of the world’s most famous types of trading. By volume, it is the largest market in the world, followed by the trading market. Although the market’s main participants are large banking institutions, anyone can trade forex with the right tool and platform.
In this article, we shall discuss forex trading online, the best tool for trading forex, and the benefits of trading forex with MT4 and MT5.
Let’s get started!
What Is Forex Trading?
Forex trading is a foreign exchange market with a daily volume of $7.51 trillion. Traders buy and sell currencies on the global market 24 hours a day, five days a week, in 170 countries.
Yet, the center of forex trading is London, while the UK accounts for about 40% of the yearly forex trading volume.
Thanks to the development of technologies, online forex trading has become popular worldwide. The internet connection and specialized software tools lower the entry barrier for people worldwide who wish to try their hand at forex trading.
The market has over 15 million active participants worldwide, which is growing.
While the success of forex trading requires knowledge, experience, and practice, the availability of handy tools also plays a significant role.
The most popular instruments designed to trade forex are the world-renowned platforms MT4 and MT5.
What Are the Best Tools to Trade Forex for Starters?
It is generally recognized that the best tools for trading forex are the world-renowned platforms MT4 and MT5, which are now in newer versions.
MT4, also known as MetaTrader 4, is a forex-only trading platform developed in 2005 and tuned to fit the needs of forex traders. It has advantages like real-time updates, fast operation processing, a handy design, and an intuitive user interface. This is achieved thanks to the specific programming language developed to ensure these features—MQL4.
The language also supports the creation of additional bots that can be used to enhance the existing functionality.
As MT4 was very popular among forex traders, the company released an updated version, MT5, in 2010. The newer version had some additional features on top of the existing ones and also supported multi-asset trading (commodities, cryptocurrencies, etc.).
Although many forex traders also accepted the newer version, MT4 has remained the favorite tool for many in this domain.
Below, we describe the key features of both tools and how they are used in forex trading.
Key Features of Forex Trading Tools
As mentioned, MT5 allows for trading different assets, but this doesn’t mean forex traders abandon it. On the contrary, each of the platforms, MT4 and MT5, has its pool of supporters who love them for:
- Simple and intuitive interface
Both platforms boast sleek designs, intuitive panels and menus, and handy tools with tooltips. Even an entry-level trader can instantly understand the purpose of each tool.
- Multiple order types
Sometimes, you need to automate your trading operations to start and end at convenient price levels even without your intervention.
The order types functionality serves exactly this aim. For example, one of the order types, Pending Order, allows you to set the instruction so that the system starts buying assets when their value reaches the price you predefined.
MT4 features four types of orders, while MT5 features six types.
- Comprehensive charts
Both tools are known for their comprehensive charts, which include many indicators that grant a solid basis for decision-making. For example, MT4 has 30 built-in indicators, while the newer version of the program raises this number to 38 and allows for 40 custom-made graphic objects.
- Strategy tester
Both tools allow for fast and comprehensive strategy testing based on historical and real-life data. While MT4 allows for single-threaded testing involving one currency pair, MT5 allows for multi-threaded testing involving several currency pairs.
- Timeframes
The timeframes functionality allows for checking the indicators over different periods of time, so a user can visualize the processes happening within different timeframes. For example, you can check events for several days, a week, or several hours.
- Mobile support
Both apps are also available on mobile, including Android, iOS, and Windows Mobile. This allows traders to perform operations via several clicks and receive notifications about important market developments.
Summing up
While forex trading is open to anyone, the right tools are necessary to achieve your aims. MT4 and MT5 are the best tools for forex trading, offering all the necessary functionality with a simple interface understandable to traders of all experience levels.
