Forex trading can be an excellent hobby for you and a source of income. Each day, the estimate of the securities trades is about USD$22.4 billion, and that of the forex market is about USD$5 trillion daily.
With this amount of money, there’s always a share for you when you know how to play the cards well. One of the most popular charting platforms for forex trading is MetaTrader 4.
MetaTrader 4 (MT4) is a forex trading platform you can use to analyze and trade in various financial markets. It’s primarily a charting platform where you can see different currency pairs’ current and historical prices, analyze trends, and predict the possible future using technical analysis tools. The platform is popular and available for Mac, Windows, and Linux.
The platform is popular because it has a wide range of inbuilt indicators. It gives you a variety of products to trade, such as major and minor currency pairs, cryptocurrencies, commodities, and stocks. Moreover, you can install automated trading bots to milk cash from the market as you engage in other activities. The following is how you can use MT4 for profitable forex trading:
- Use pending orders
With the MT4 platform, you can instruct the system to open and close trades later instead of executing the order immediately. This is known as pending orders. It’s a handy feature because you may not always have the time to open the charts now and then to wait for the prices to fall or rise to a certain point.
Once you identify a perfect entry point, place a pending order, and your trade will open once the market hits that level. You can also set the Take Profit and Stop Loss orders with the pending orders. For the Stop Loss, it’s best to fix it at a level that minimizes your risk to 1% or below, as professionals advise. The following are the types of pending orders that you can use on MT4:
- Sell stop: You set this below the current market price if you suppose the prices could drop further, perhaps after breaking a support level.
- Sell limit: You can use this pending order to take advantage of a resistance level if you predict a downward trend will follow.
- Buy stop: You set this above the current price if you predict a potential breakout at a resistance level in the market.
- Buy limit: This is a pending order you can place at a support level if you expect an upward trend to follow after the market hits that level.
The client terminal will easily allow you to control and manage any of the pending orders you have. You can delete the pending orders if you change your mind. In addition, you can set an expiry date and time for the orders, which automatically deletes them if the prices don’t reach the anticipated levels by a predetermined time.
- Customize your charts
The default MT4 chart display may not be appealing. Luckily, you can customize your charts in multiple ways using period separator grids, indicators, and objects to help you with trend analysis. Some of the commonly used indicators you can find on MT4 include the following:
- Moving averages: These show you the prevailing trend, wherein prices above the moving average depict an uptrend, while prices below the moving average signify a downtrend. Sometimes, trending markets retrace to the moving averages as supports before resuming the impulse moves. Thus, you can use the moving average as an area of value for opening trades.
- Relative strength index (RSI): You can use this indicator to determine a currency that is oversold or overbought to expect a reversal. It’s a perfect fit if you’re a buy-low or sell-high trader.
- Slow stochastic: The indicator works like RSI to identify oversold or overbought environments, except it has two lines, %K and % D. To identify such trades, you look at the points where the %K crosses %D.
- Moving average convergence and divergence (MACD): You can use this in ranging or trending markets since it displays changes in momentum using moving averages.
Customizing your charts simplifies your trading, and your forex trading becomes fruitful.
- Use shortcuts
Keyboard shortcuts are a great way for you to save time while trading. That’s especially true if you’re day-trading the shorter time frames and you need to make quick decisions throughout the day. With shortcuts, you can access tools faster on MetaTrader 4 and get rid of information and functionalities that are redundant. Some helpful shortcuts include:
- Terminal: CTRL +T
- Zoom in: +
- Zoom out: –
- Navigator: Control +N
- Market Watch: Control + M
- F8: Edit your chart graphics
- F9: Order panel
- F12: Full-screen chart
These shortcuts make navigation around MT4 easy for you. But of course, you can still access these functions from the menu bar.
- Use alerts
Consider using alerts for fruitful forex trading on MetaTrader 4. Alerts help you keep track of critical price levels to have perfect entries or exits. Instead of watching the charts now and then, you get text messages or emails right on your phone when the market behaves in a certain way. Hence, you eliminate the typical worry of being away from the charts without knowing what’s happening.
- Use mobile trading
You can use mobile trading to succeed in forex. This offers you incredible flexibility and mobility since you can access MT4 from your smartphone or tablet. Plus, it gives you a trading edge where you can follow global markets from wherever you are. Mobile trading gives you various analytical options as well, including displaying graphical quotes. Although the MT4 app doesn’t include all the indicators and analysis tools found on the desktop version, you can still find the basic functionalities helpful while on the go.
- Use expert advisors
An expert advisor is a software or a robot that opens and closes trades following predefined guidelines. Once you develop a solid strategy with precise entry and exit rules, you don’t have to do it manually over and over again. You can create a program to initiate trades on your behalf without you having to open the charts. It’s an excellent way to earn passive income since it doesn’t take a lot of your time and energy. On top of that, expert advisors are ideal for emotional traders, as they eliminate the fear factor from your trading.
Conclusion
MetaTrader 4 has a user-friendly interface; even as a novice trader, you can easily navigate it. The handful of tips above is essential to improve your chances of earning more as you trade. Coupled with expert trading tips, you can become highly successful by trading on MT4.