What Tools Do Forex Traders Use?

There are similarities between the tools that foreign exchange (forex) traders, crypto traders, and stock traders use, although they are not quite the same. That being said, it isn’t uncommon to find that a single application, piece of hardware, or web tool has features to benefit all three.

Be that as it may, the list here has been created exclusively with forex traders in mind. Instead of just mentioning several different forex trading platforms, let’s separate them down into the three broad categories.

Digital Trading Platforms

Digital trading platforms are the online equivalents of classic stock markets such as the London Stock Exchange on Paternoster Square, or the New York Stock Exchange in the Financial District. Over time, online trading platforms have become significantly more useful than any offline trading platform be today.

In addition to providing a platform for foreign exchange transactions to commence, membership should also come with plenty of free and paid features related to data analytics, market predictions, real time updates, wide support for various currencies, trading simulation options, strategy building support, copy trading services, etc.

One of the primary sources of revenue for any forex trading platform is the fee that they charge on transactions. As a trader, you should pay attention to how much they are charging because you can always move to a different one if you feel overcharged. Some of the most well-known online forex trading platforms in UK are IG, City Index, HFM, eToro, and CMC Markets.

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Trading Calculators

For traders in general, calculations and estimations are key to making the right decisions. However, calculations hold even more specific importance to forex traders because they need to constantly work with numbers and values that are exclusive to the foreign exchange market. Therefore, forex trading calculators designed to help traders calculate risk percentage, PIP value, position size, swaps, etc., are among the most important and extensively used trading tools available.

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Charting Applications

In trading, charting applications are used to analyse available data from the market and create illustrative visual charts with candlesticks, bars, line graphs and the like to depict all findings. These representative charts will illustrate relevant findings from all three timelines, that is to say the past, the present, and the estimated future forex market conditions.

Depending on the software in question, charting tools may also support preprograming, automated trading, strategy configuration testing, parameter-based trading signal customisation, and so much more. RoboForex, Ultimate Charting Software, and Statmetrics are popular charting tools among forex traders.

It is quite possible that a single trading platform will provide you with all the tools that you might need to trade in forex intelligently. In fact, this is even desirable, as it simplifies and streamlines the trading process. However, you should also be on the lookout for better tools and rates from the competition, after you get the hang of things. Expert forex traders will often use different tools from multiple providers, choosing only to work with the best options available.