Broker to Trading

MetaTrader 5 (MT5) is the successor to MT4. While many brokers offer MT4, MT5 is less prevalent. These brokers are regulated in the United Kingdom by the Financial Conduct Authority (FCA) and offer MT5 to UK clients (as well as MT4).

MT5 has some similarities to MT4: each allows both discretionary trading, where the trader makes their own trading decisions, at their discretion and automated trading where computer programs make the decisions of behalf of the trader. For both platforms these programs are called Expert Advisors (EAs) and can be used, modified or built by the trader (in the MQL5 programming language). Expert Advisors are automated trading strategies, i.e. the kind of rules a trader may apply when trading on their own behalf, based for example on indicators, but codified in and executed by computer programs (known as online trading robots).

However MT5 has made a number of enhancements. There is an increased number of indicators inbuilt on the platform. Indicators can also be added, however and modified or built by the trader, a feature of both MT4 and MT5. There are more graphical objects on MT5 vs MT4 and MT5 has more time frames.

MT5 additionally has market depth as standard. Market depth shows the bid and offers at various prices, depending on the volume being traded. MT5 has more order types and order fill types (i.e. specifying when an order is to be filled).

For all traders, but particularly news traders, an economic calendar is supplied on MT5, unlike MT4. An economic calendar can be an important tool for the trader, as examining it before beginning the process of formulating and executing a trade (or running an robot) can provide an indication that volatile market conditions may happen around the time of the release of important economic data.

Trading on a news release is a specific kind of trading, tailored to the rapid movements which may occur. Traders may wish simply to sit out a major news release. In all events volatility can be expected, sometimes intense volatility, around before and after the news release.

A major news release can affect trading sessions before and after release. For example in the extended run up to an Interest Rate decision pertaining to a particular currency, trends can be seen which may reflect the market pricing in an expectation of what the data will be. The data may differ from this expectation and this can create sharp moves, which can reverse and oscillate. A feature of news trading is that the market may not do what is expected and can even in some cases be relatively calm. The time after can be seen as the market coming back to its more normal state, but the effects of any volatility may still be seen. In later sessions, the market may amplify these effects into a kind of reprise of the news event.

Brokers which offer MT5 and MT4 may focus on high speed order execution and no dealing desk execution allowing a wide range of trading styles, such as scalping. Typically but not always MT5 has more markets than MT4, and some brokers can have a relatively large number of markets, in the several hundreds or more, the bulk of which are Stocks CFDs.