One of the key features of the forex market is the high volatility combined with liquidity. Both these features of international currency pairs have made it the most popular asset class among global traders. Thus, the forex market is considered the world’s largest and most lucrative trading market. Still, all forex traders will agree that trading in the fast-moving currency market is a challenging venture. That’s why every trader in the forex market needs to gather some powerful tools that can help them explore the market with ease.
Today, we will be learning about popular forex trading tools and how you can use them to your advantage to optimise your trading process.
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As you may already know, forex trading can be complex for beginners and experienced traders. Attempting to predict the price movements that are about to take place and placing trades with profit potential is a challenge for a newbie. Experienced traders also come across many hurdles and issues on a daily basis. Hence, traders of all levels will require some tools that can simplify the trading process to some extent, taking them closer to profitability and success.
For forex traders, these tools will come in handy in analysing the market, identifying the right trade setups, planning trades, performing trade-related calculations and also playing a role in the perfect execution of trades. In short, the forex trading tools can be referred to as an inseparable and integral part of the trading process. With the proper tools, even the most skilled trader can succeed in the market and using the right tools can transform a beginner into a skilled trader over time.
The first tool in our list is a forex trading platform, which you can afford to ignore if you want to get into trading. You need fully functional trading software to access the forex market and place trades. This is the most basic but also an essential forex tool that needs to be there in your trader’s toolkit. When you sign up for a trading account with a Forex broker, you will see the trading platforms they support.
The most popular and commonly used trading platforms are MT4 and MT5. Some top brokers also offer other platforms like cTrader and ActTrader. You just need to check the features, tools and functionality offered by each of these platforms in order to choose the best one for yourself after considering your own requirements.
Most forex trading platforms come with in-built charting tools that can be customised based on your needs and preferences. Price charts are one of the most important tools forex traders use for technical analysis of the market situation. The most popular chart type in forex is Japanese candlestick charts, as they are the most detailed and comprehensive when it comes to trading. You can also find many good charting software if you want to use more advanced charts in trading.
Planning and executing your trades with perfection would only be possible in the absence of logical calculations. Forex trading calculators are automated tools that can help you perform trade-related calculations faster and more accurately. There are different types of trading calculators for performing various functions. Let’s have a look at some of the most commonly used online forex calculators that are offered by many forex brokers and trading platforms and can be used free of cost by anyone.
Economic calendars are a must-have tool for fundamental analysis of the forex market. This tool contains all the information and updates regarding key economic data releases, central bank meetings and more which can impact the exchange rates of currencies you trade with. Hence, every forex trader should use this tool to stay up to date with economic changes.
To sum it up, forex trading tools are not just mere tools but serve as stepping stones to success in the forex market. Because each and every trader will have to use these tools for upgrading their trading skills and climbing to the top, you just need to find the right set of tools that can assist you in the process, as these tools play a key role in your trading journey.
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