Forex trading platforms are designed to benefit the life of currency traders. Since the primary motive to trade forex is to get maximum returns on one’s investment. Therefore, the platform he or she is using should be easy-to-use, efficient and authentic. The term “easiest forex trading platform” is abstract. Be it trade implementation or strategy execution, marking a software easy depends on several factors.
Lessons of a trading platform:
These lessons are also the precautionary measures which one should keep in mind before placing his trade through a platform.
- Make correct assumptions with time:
Even the easiest forex trading platform is designed to operate through time charts. Now, currency volume traded is not fixed throughout the day. The majority part after midnight does not see effective trading except for Europe and US which are active during this period.
Therefore, it is quite possible that an automated trading platform will detect authentic signals during active hours and may return false positives during low activity periods. This mainly happens due to poorly designed algorithms that respond to low and high currency volumes equally.
- Treat forex as a risk management exercise:
The basis of forex works on leverage. With high leverage ratios of 100:1 or above, the noise to signal ratios deteriorates significantly resulting in poorly formed patterns. As a result, this may cause incorrect readings on a forex chart. Since trading software operates by charts, higher leverage can lead to costlier losses.
So an easy to use forex trading platform will minimize drawdowns when strategies seize to work and will preferably capitalize on the winning pairs.
- The science of stop losses and trading false positives:
With shorter periodicity, the market gets noisier or more volatile. One can calculate a rapid erosion of the equity curve by summing up the higher frequency trades with the effective value of false positives. To deal with this scenario, one can opt for the following three alternatives.
If you are a trader of shorter time frame, then it is appropriate to scale out of the position as fast as possible.
Manage time the correct way. It is vital to keep track of the different time frames and their opening as well as closing hours. This will greatly benefit you to avoid false positives.
It is important to thrive on the overlapping sessions of trade. At these points, the market is at its noisiest. More volatile the market, the greater profits you can earn.
The general rulebook about easiest forex trading platform
Such easy platforms will inform a trader of these market tendencies through its notifications. Moreover, it will also keep a check that the optimistic overuse of leverage does not result in unprecedented losses. Such assured service is only obtainable if a platform allows monitoring charts, performing back testing and analyzing the pattern of a currency pair.
As mentioned, the term “easiest forex trading platform” is abstract but attainable through certain precautions or lessons. Wise management of resources and calculated trading ensures a trader the profits and secures his trading position in this currency market.
The content of this article reflects the author’s opinion and does not necessarily reflect the official position of LiteForex. The material published on this page is provided for informational purposes only and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC.