If you’re keen to engage in scalping, your broker should support all of the following:
- 1-click market orders
- Automated trading
- Option to pre-set stops/limits
- Depth of market (DOM) information
The Forex trading accounts featured in the comparison table on this page tick all these boxes. Use the search filters on the right-hand-side of the page to find an account that matches your preferences.
Depth of market
Depth of market (DOM) shows pending buy and sell orders for a currency pair at different prices. The greater the number of orders, the greater the market depth and liquidity.
The balance between buy and sell orders provides scalpers with unique insights into the most likely short term direction of change in prices. More liquidity in the bid suggests a long position may be in your interest. Likewise, a surge in liquidity available on the ask suggests the market may have a short bias.
However, depth of market information is only available from ECN Forex brokers. Neither Market Makers nor brokers with Straight Through Processing (STP) execution are able to show DOM.
Speed of execution
Speed of execution is everything when you engage in scalping.
Your broker’s platform should support 1-click execution and trading from the charts. In addition, you could also consider automated trading strategies to monitor the market when you’re away, protect your positions or realize profits from small changes in market prices.
Automated trading is available on range of platforms including MT4, cAlgo and JForex. However, platform support is not enough by itself. Your broker should explicitly support all Expert Advisors in the case of MetaTrader 4 and automated trading robots in the case of cAlgo and JForex.
Set stops and limits before entry
Stop and limit orders can help mitigate risks and realize profits for small changes in market prices. Your trading platform’s implementation of stop and limit could make a world of difference to your take-home profit.
First, a refresher for beginners:
- A stop order, also known as a stop-loss order, is a conditional order to close a position once a certain price is reached. A stop order helps protect against unfavourable movements in market prices and is designed to cap your losses.
- A limit order, also known as a take-profit order, works in reverse to a stop order. It is a conditional order to close a position once a certain price is reached. However, a limit ordered is triggered when prices move in your favour. It is designed to realize the profit on your position.
However, setting stop and limit orders can be tedious and time consuming. Ideally, your trading platform should allow you to set your stop and limit prices at the very same time you enter the market. You achieve this through robotos on MT4, JForex and the cTrader/cAlgo platforms.
- Brokers for Automated Trading
- 5 Digit Forex Brokers
- STP Forex Brokers
- DMA Forex Brokers
- Currenex Brokers
- ZuluTrade Brokers
- Forex Options Brokers