Broker to Trading

An online trading platform is the interface through which the trader trades markets. Forex is a market to trade. Thus an online trading platform for Forex is an interface through which the trader trades Forex.

Online trading platforms tend to have a basic similarity. They generally have a chart. The chart is a key part of trading as it provides a representation for the movement in value of a market. More than this, as a market moves, it traces out patterns. These patterns form the basis for technical analysis. The patterns themselves can be analysed. This is because trading focuses on trying to find a basis for speculating on the direction a market will move from the time the trade is entered.

However it can be seen that markets do not tend to move in one direction or another, but trace out patterns defined by moves up or down. A pattern provides a structure for speculating on direction in this complexity, like a frame with directional hints. Patterns have a geometrical structure which provide space within which a market may move, but based on past behaviour. However a market may not conform to this expectation and patterns frequently fail.

On the chart are typically tools such as technical indicators and graphical objects. These provide a way to further apply technical analysis. Graphical objects can be used to apply techniques such as those based on trend lines, which again project direction. Technical indicators normally apply formulae to market data. These formula can be based on concepts such as deviation from mean values, with the idea that the market will alter its direction based on premises. Indicators can be based on a wide range of formulaic premises, including chaos theory and other concepts. The main idea is that they expect the market to conform to the projections of the formulae. However the market is quite capable of not doing so.

Running through technical analysis is a more generalised concept of regularities that the technique expects the market to conform to and upon which the trader can find a way to gauge potential direction, based on market data.

Technical analysis is a key part of Forex trading, which is to say in general finding a way to gauge the direction a Forex pair will move in. A Forex pair is the market which is to be traded. It consists of two currencies, one valued in the other. Behind each currency is an economy which itself releases data on an ongoing basis.

A platform may have an Economic Calendar accessible from it, or perhaps this will be on the broker's website. This provides a timeline for this data along with past results (as the data is typically recurring), the actual result when it happens, and before this the projected result. This is fundamental data and provides another way to try and gauge the direction a Forex pair (or any other potentially affected market) may move in.

However as with technical analysis, the actual direction moves can differ markedly from the expected direction. Even if it does, then it can rapidly reverse direction as well. For these reasons a trader may wish to automate their trading. Trading automation does not in and of itself provide better results, but when trading with a robot, the trader can let it trade based on its programmed assumptions, rather than second guessing their trade. This of course can result in rapid losses as well.

Some brokers offer account geared towards this type of trading, in that they provide ECN accounts. ECN accounts aim to provide fast order processing as well as allowing a wide range of trading styles. The trader may wish to simply copy trades of other traders, and some online trading platforms provide this capacity. Traders may simply want to see the views of other traders, and this may be supported as well.

Some traders may only be interested in self directed trading which relies on their own analysis and in general platforms support this type of trading, no matter what extras may be available. However certain brokers focus on this type of trader by aiming to provide a platform layout and functionality which is as human user friendly as possible. The following table provides a selection of brokers offering online trading platform supporting the types of trading discussed in this article.

An online trading platform is provided by a broker. Platforms may be in-house platforms or third party platforms (such as MetaTrader). The broker will provide the range of markets to trade as well as additional tools and software, for example a third party social and copy trading platform.