Online forex broker is a company that help traders by provide trading platform where they can buy or sell various currencies. As a trader, you will use these brokers services to access the forex market 24/5.

These brokers are usually compensated through the bid-ask spread of a currency pair. For example: EUR/USD bid price is 1.4613 and ask price is 1.4616. If a trader makes entry to the market at that time he can either buy at price 1.4616 (ask) or sell at price 1.4613 (bid). In this case the spread is 4616-4613=3 pips.

Different online forex broker will have different policies about the spread for each currency pair, so you must read this information first, particularly your favorite currency pairs. For widely used currency pairs like EUR/CHF, GBP/USD, or EUR/USD, it is pretty common to have low spread 2-4 pips. But other currency pairs like CAD/JPY, EUR/CAD, and CHF/JPY have higher spread of 8-17 pips.

Although most of forex brokers make their incomes through spread, there are also brokers that charge commission fee per trade in addition to their profit from spread. This fee is charged per lot. One lot equal to 10,000 units of currency; for example: 10,000 units are equal to USD 10,000; EUR 10,000; GBP 10,000; etc.

So, do you need $10,000 in order to enter forex trading? Not anymore; the current forex trading has solve that problem with leverage system. A 200:1 leverage means that you only have to deposit 10,000 / 200 = $50 in order to trade 10,000 units or one lot. Basically, a forex broker that ask for fees per lot will make you lose that much for each trade.

When you decide to use an online forex broker, you will gain access to their online trading platform. You can get live chart, price movement, news, and various other functions to support your trading activities such as execute orders and put trailing stop from these platforms.

Based on experience, not every trader are comfortable with certain trading platform, so it is a wise decision to open a practice account first and test the trading platform for a period of time. I suggest you try a few trading platforms at once and see which one fit you the best. Remember to pay attention to how quick the platform executes your order.

Opening a practice account has other uses too. If you are an experienced trader and have certain strategies, you might want to test if the platform supports it or not; for example: hedging.

Hedge a trade is have buy and sell trades in the same currency open simultaneously. This method can be utilized by a trader to lock any loss trades that he has.

Example: a trader buy EUR at 1.4815, then the price dropped to 1.4785. Instead of closing the lose trade, he sell EUR for 1.4785 and thus lock the loss at 30 pips. Then he waits the market movements and hopes to avoid loss by closing the two positions at the right price. This is quite high risk strategy, so usually a trader will choose stop loss instead.

So here are what to check on an online forex broker:

1. How they gain their compensation; is it through spread? Is it through spread and commission fees? Check the spread for your preferable currency pairs and if they charge commission, check the commission rate per lot.

2. Check the trading platform; make sure it suit you, provide various resources for your trading, execute order quickly, and doesn’t go down too often.

3. In case you have certain strategy that not usual, ask the customer support if their trading platform allows it or not.

4. If you are planning to use Forex Robot, ask them first whether they allow forex robot or not. You can do this quickly by utilizing the live chat feature. There are some very good robots at the market currently and you may decide to use one of them someday, so I suggest you take the one that allows it.

Pick the credible online forex broker doesn’t has to be a difficult task; what you need to do is test their trading platform and ask the rest of the questions via live chat or email.

As a trader, Matthew John has tried many different systems. Read about his suggestion about a forex broker that offer the most benefits at 4XP review. If you need further research to make sure that you have selected the right one, read his guide atcurrency trading account.

The market turns against you and the desperate need to blame someone but yourself arise. Has your broker forcefully removed you from the game by moving the market price to the level of your stop-loss? Or is it just a myth created by the paranoid traders? Is there stop hunting, and if so, how to avoid it?

What is stop-loss hunting? Basically, stop-loss hunting is all about causing the market price to reach your stop-loss order and push you out of the market with a loss.

In other words, the big financial institutions have to intentionally buy/sell a large amount of currency which changes the market price accordingly and hits the trader’s stop-loss levels and kicks the trader out. Meanwhile, the financial institutions gain from the losses, by taking the other side of the trades and profit from the short-term move.

The story about hunting stops is familiar to every trader. However, most traders who have been “stop hunted” simply had a bad trading day, got a paranoid idea that the broker is “spying” on them and force out the positions placed.

Technically speaking, it is true that your forex broker know where your stop-loss are placed via the trading platform. Once you place a stop-loss order, the broker will be aware of it. However, it is rather unprofitable for forex broker to try to take out your orders.

Why? Well, although it is true that every forex broker offer different spreads, a broker probably wouldn’t risk moving the prices just to force your orders out. Besides, your losses are not profitable for the broker. A reputable forex broker want you in the game, because a profitable trader can afford larger lot sizes and therefore make more commissions for the broker of the spread.

Forex forum posts and blogs may give you an impression that stop-hunting is a common practice among brokers. However, in most cases, the upset traders simply blame (maybe even unconsciously) stop hunting for their losses because it is the convenient way to find someone responsible for their losses. No one likes to realize their own mistakes, right?

Yes, it is true that a stop hunting forex broker may profit in the short term, however in the long run it is destructible. A forex broker with bad reputation will quickly lose the existing and potential trades. Besides, it can also cause a potential legal problem. Overall, it is highly unworthy for forex broker to stop hunt in the first place.

In case you are still convinced that your forex broker is guilty of stop-hunting, here are some tips of dealing with the situation:

1. Change the broker! The easiest way to get away from stop-hunting issue is to withdraw your money and move on to another broker. If you cannot rely on your own broker to deal with your orders, then how can you possibly continue trading with it?

2. To make sure that your broker is really involved in stop-hunting, it might be a good idea to open another trading account with another broker and compare their lows and highs.

3. Confront your forex broker about your suspicions by writing an email and attaching some evidence to it (for example, the screenshots of other broker’s highs and lows).

4. Use mental stops instead of placing an stop order on the platform. This advice is only or advanced traders. You have to know the risks involved with “mental” stops! Make up your mind (let’s say, stop whenever a certain price is reached) and follow your plan. This is basically the full proof! Your forex broker won’t know where the stop is and therefore wouldn’t try to hunt it.

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If you are looking to move abroad and/or are seriously considering purchasing a property abroad, you need to be aware of the options available to you for securing the best exchange rates for your currency transactions.

Many people choose to use their own or high street banks when they want to purchase currency for another country or region. There are a number of possible reasons for this:

• comfortable dealing with a known and trusted entity
• no need to register
• lack of knowledge with respect to alternative options
• belief that the banks offer the best exchange rates
• pure lethargy

It is possible that on a particular day and with perhaps a special offer available that a bank can compete with online forex trading brokers, but it is much more likely that if you choose to investigate the rates and charges offered and levied by an online broker they invariably offer better terms than the high street banks i.e. they will give you a better exchange rate and will charge you less for the services they provide.

If you do the maths you will find that for larger transactions such as property purchases that a saving of 1 or 2 centimes, as an example when purchasing Euros, can amount to serious financial savings overall, often into the thousands.

Less significant savings, but savings all the same can be made on ongoing expenses, such as cost of living payments that need to be funded from one currency to another.

In order to realise these savings you can visit a number of online foreign exchange trading companies using the Internet, compare what rates they offer at any particular point in time so that you can compare and contrast that rate both between the forex traders themselves and the competing high street banks.

Once you have established a few brokers you feel offer the best rates and terms, all you need to do is register with them and complete an application for their services, this step is a legal necessity which has been brought into place to combat money laundering frauds, once your application has been accepted you will then be able to utilise the service that offers the best deal at any given time.