This week’s question comes from Rizah, who asks:
What is the best platform for trading Forex?
There are dozens of platforms for trading Forex. When you factor in the various proprietary platforms, there are hundreds.
For the beginning trader or the one still trying to find their way, this can seem daunting.
Each one offers different features and layouts. That means each time you switch, you have to relearn everything.
This takes away from the time you could otherwise spend learning how to trade Forex.
You didn’t decide to become a trader to learn a piece of software. You did it because you love trading and ultimately want to learn how to extract money from the markets.Therefore it makes sense to choose a platform that doesn’t have a steep learning curve.
So what is the best Forex trading platform?
Everyone will have their own opinion, but in my experience the MetaTrader 4 (MT4) trading platform is superior to the rest.
Why is it my favorite?
Not because it offers features or resources others don’t. Just the opposite, in fact.
Read on to find out why I favor MT4, especially for those trading Forex price action. And please be sure to let me know which platform you like at the end of this post.
4 Reasons MT4 Is the Best Forex Trading Platform
There are obviously more than four reasons to use the MetaTrader platform. It’s been around since 2005 and has been through dozens of iterations. This means the team behind MT4 have had plenty of time to get it right, and get it right they have.
Here are my top four reasons to use this platform, especially if you’re trading price action.
1. Simpler Is Better
Forex brokers often entice traders to sign up with new features and resources.
There’s a common misconception that retail traders fail due to a lack of inside knowledge. The idea is that if these traders were more informed about what’s happening in the world, they would perform better.
My experience tells me otherwise. It isn’t a lack of resources that causes retail traders to fail.
It’s a lack of patience, overcomplicating a simple process and overleveraging one’s account. Those are the primary reasons more than 90% of retail Forex traders fail.
Lack of information has little to do with it.
I’m sure there are exceptions to the rule, though. However, if you’re trading price action, simpler is better.
This is where the MetaTrader 4 platform really shines. It cuts through all the unnecessary add-ons and allows you to focus solely on the price action.
2. You Only Have to Learn It Once
MetaTrader 4 is available at just about every major Forex broker.
This is great news if you’re tired of jumping from platform to platform.
There’s nothing wrong with using your broker’s proprietary trading software. If you like it and it works for you, then by all means use it.
However, doing so means that if you decide to switch brokers, you have to learn an entirely new piece of trading software.
So instead of learning how to trade Forex, you’re stuck learning a new technology.
But if you’re using MetaTrader, you don’t have that problem.
If you decide to switch brokers, no problem. The new one likely offers the exact same MT4 platform you’re used to.
Apart from the broker’s logo in the top left corner, everything is the same.
I don’t know about you, but I would rather spend my time learning and trading rather than fumbling around with a bunch of new features I don’t need.
3. It’s Lightweight
The last thing you want is a resource-hungry trading platform.
Unless you have a brand new computer or one designed specifically for trading, using a lightweight platform like MT4 is key.
I have used other proprietary ones and I can tell you that MetaTrader is by far the lightest on resources.
That means faster load times and less lag while navigating the platform.
Although rare, the lag from other resource-hungry platforms can even cause delays with the data. This is especially true for older computers.
Accurate and timely data is a must. By using MetaTrader 4, you can have greater confidence that your trading software isn’t the bottleneck.
4. Perfect for Those Just Starting Out
I get a lot of emails asking about the best Forex trading platform for beginners.
These individuals are clearly looking for something without a steep learning curve.
That makes perfect sense. You’re new to Forex and you want the most direct path to learn how to trade.
Learning how to use a complicated trading platform is seen as a roadblock.
The simplicity of MT4 allows you to jump right into the price action on your charts.
Sure, you will need to learn how to use some of its features, but that’s true of any new piece of software.
So if you’re a beginner, give the MetaTrader platform a try. It will cut the learning curve in half and allow you to spend your time learning new strategies and techniques.
MetaTrader 4 and Price Action
The four reasons I just listed explain why I favor MetaTrader above others.
I have been trading price action since 2010. During that time I have used at least five or six platforms.
Some were better than others, but I always came back to MT4.
That may be confusing for some traders, because it doesn’t include many of the features that come with other software. Even the charting tools are somewhat limited.
But you know what? That’s a good thing.
I don’t want a complicated platform and I certainly don’t need an arsenal of unnecessary add-ons.
Simpler is always better. All I need are candlesticks charts, two moving averages and some lines. That’s it!
Anything more than that is not only unnecessary, it’s a distraction.
How to Get Your MT4 Charts to Look Like Mine
Last but not least, I want to show you how you can get your charts to look like mine.
These steps are specific to MetaTrader 4, but any good trading platform will have similar settings to these.
Step 1: Remove all indicators
The first thing you need to do is remove all the indicators from your chart.
It doesn’t matter which chart you use, because we’ll save these settings as a template in Step 4.
Just be sure to remove all of them. That includes the RSI, MACD, Stochastics and any moving averages.
The only thing left should be the price action on the chart.
Step 2: Configure colors and layout
There is an easy way to configure the black and white charts in MT4. This is a color scheme I have used for years. I find it much easier on my eyes than having a darker background.
To get it, simply right click anywhere on the chart and select Properties.
On the Colors tab, choose the Black On White color scheme from the drop down menu.
That will take care of your chart’s background colors, as well as the candlestick’s colors.
On the Common tab, be sure your settings are the same as the image below.
Once you have the color scheme selected and the options configured on the Common tab, click OK to activate the new chart settings.
Step 3: Add exponential moving averages
Now that you have a nice clean chart to work with, you’ll want to add the two moving averages I use.
The 10 and 20 exponential moving averages (EMAs) serve as a mean reversion tool.
To add them, click View and then select Navigator.
Drag the indicator titled Custom Moving Average onto the chart. As soon as you let go of your left mouse button, you will be presented with a window.
Before I show you the settings, I do want to point out that these are the only two indicators I use. I don’t use a MACD, RSI or anything of the sort.
I also don’t use the 10 and 20 exponential moving averages as a crossover signal. In other words, I don’t care much whether the 10 is above the 20 or vice versa. That isn’t how I enter the market.
The only thing that matters to me is where the two moving averages are in relation to the price on the chart.
See A Guide to Market Timing to learn how I use them.
Here are the settings for the 10 EMA:
If you move over to the Colors tab, you can set the color for the 10 EMA. I use red.
Click OK and you now have a 10 EMA on your chart.
To get the 20 EMA, you need to drag another Custom Moving Average onto the chart from the Navigator window.
Here are the settings for the 20 EMA:
Be sure to choose a color from the Colors tab. I use blue for the 20 EMA.
Step 4: Save the configuration as a chart template
You don’t want everything we just did to go to waste. Nor do you want to do these steps for every currency pair.
Luckily, MT4 allows you to easily save chart settings at a template.
To do this, simply right click anywhere on the chart we just configured.
Then scroll down to Template and select Save Template.
Here is where you can name your template. I’d suggest giving it a name you will remember, such as Price Action.
Just be sure to use the default Template Files (*.tpl) as the type of file. See image below.
Once you click Save, your chart settings will be added to the list of templates.
To access the template you just saved, open a new chart and right click just like you did before.
Select Templates and then choose the one you just saved.
Now you have a quick and easy way to transform any MetaTrader chart into one that looks just like mine.
There are many reasons why MetaTrader 4 is a great fit. Whether you’re a newly minted Forex trader or a seasoned professional, the MT4 trading platform has what you need.
I’m a big fan of keeping things simple. Unlike other Forex trading platforms, MT4 is rather basic in its features, which is a good thing.
When it comes to trading price action, simpler is better. Everything we need is already on the chart.
That means there’s no need for those additional features and resources offered by some brokers. Not only will it overwhelm and distract you, but it will also hog computer resources.
In my opinion, MetaTrader 4 is also the best Forex trading platform for beginners. It’s easy to use and available with most Forex brokers, so you only have to learn it once.
It’s important to find a platform that you’re comfortable with, so be sure to experiment. That said, MT4 is a great place to start.
Your Turn: Ask Justin Anything
I’d love for this new weekly Q&A to be successful and provide an invaluable repository of answers to common Forex questions.
To do that, I need your help.
Here’s what you can do to get involved and have your question answered in next week’s post:
- Ask questions. Post them in the comments below or Tweet them to me @JustinBennettFX
- Help me answer questions. If I missed something or if you have something to add, don’t hesitate to leave a comment below.