Just like any other venture or endeavour in life, forex trading is an activity that requires the use of certain tools of the trade in order to achieve success. The advent of smartphones has helped to add a new arsenal of tools that traders can use; the various apps that support trading activity on the Google Play store as well as the iTunes store. Added to the conventional software and apps that run on desktops and laptops, these apps complete a new repertoire of resources available to today’s traders.
So what are the most helpful trading software and apps that can be used by forex traders?
Autochartist is a pattern recognition tool which has been around for more than a decade. It comes as an MT4/MT5 plug-in and also has a standalone version which allows users to see what patterns are forming on the charts for different time frames. Autochartist has gotten better with time, allowing for more accurate detection and trading of chart patterns. Autochartist is more than just a pattern recognition software. It can also be used to detect support and resistance levels, trace Fibonacci levels, conduct volatility analysis as well as calculate risks. Two versions exist: one for traders and another for brokers. The trader version can be attached to a chart by adding to the MT4 or MT5 folder as a custom indicator. It is free for those who operate live, funded accounts on the platforms of partner brokers. Some of the brokers listed here on FX-list are partner brokers and will allow you access to Autochartist.
The Depth of Market tool is a feature of MT5 platforms as well as institutional trading platforms which indicates the open interest on the buy and sell side of a currency pair. It is able to provide information on the volume of buyers and sellers on a currency pair or an asset. Experienced traders can use information from this tool to know where the institutional orders are flowing and how they can influence price in the market.
The institutional trades are the ones with the largest volume and they will push the market in whatever direction they deem fit. That is why it is important for traders to know where the smart money is headed and on which side the smart money traders are on.
A margin calculator is capable of calculating how much of your account balance can be used to setup a trade, using a chosen lot size of trade volume. It is a widely accepted concept in the trading world that no more than 3% of your account size should be used to control positions in the market. This is borne out of risk management practices. However, there have been changes to the leverage that can be provided to traders in the UK and EU. Similar measures were applied in the US in 2010. These leverage caps mean that traders need more money than before to control positions in the market. A margin calculator immediately tells the trader what the maximum amount required to hold a position using a particular leverage is.
If you are a day trader, the use of automatic pivot point calculators is an indispensable tool. You need to know the potential support and resistance areas that form on the charts for each trading day as well as each trading week. Pivot points are such potential support/resistance areas. Pivot points are calculated using the high, low and close prices for each trading day, which means that they have to be recalculated every single day. Rather than calculate these values manually, you can simply use any of the legion of free automatic pivot point calculators to do this. If you use the MT4 or MT5 platform, all you need to do is to download the software, open the MT4/MT5 data folder, load the software to the indicators subfolder within the MQL4 or MQL5 main folder, then restart the platform to get the pivot point calculator placed among the custom indicators on your chart. You can then attach the software to the chart of your choice, and the indicator will automatically plot a horizontal line across each of the seven pivot points.
If you want these pivot points recalculated automatically each day, simply switch from the 1-hour time frame to the daily time frame, and back to the 1-hour time frame. Some automatic pivot point calculators do this by retaining the old lines and plotting the new ones. An advantage of this second method is that some of the old lines can turn out to be intraday support/resistance levels for current price action which is not even on a pivot point.
The role of up to date forex news and the latest news from the squawk boxes cannot be denied. The great news here is that some of these services have now found a new home in the social media as well as in the smartphone/tablet apps. Even if you trade exclusively with a desktop or laptop, you can always have your tablet or smartphone by your side and receive actionable news that you can act on.
There are many free squawk news sources for FX trading. All you really need to do is to sign up for a free membership (or a pro package if you can afford it), then learn how to interpret the news. 2020 is a year when there will be a lot of news you can trade on. Make the best of it with various news sources/squawk box apps. The search engines will reveal more than 12 of such services.
This is by no means an exhaustive list of trading software and apps for traders, but the apps listed here can provide a good foundation for traders looking for additional tools and resources to boost their trading outcomes.
