When it comes to trading the forex currency markets, whether you are a short term scalper, or a long term holder, you will want to monitor the price movement (often referred to as price action) through some type of charting software program. There are many different charting packages to choose from regardless of which currency pair you are trading – and naturally it’s important to concentrate on the key features when deciding on the one of the many online forex currency charts available.
Many online forex brokers will offer their own charting software programs. These can be in the form of a direct stream from their server through your web-browser or may be in a downloadable format, which is then saved to your computers hard-drive and installed locally. The main advantage of using a cloud based charting platform is that It can be used anywhere, one does not need to be stuck in the office or carry one’s laptop all the time, just to view the charts. The downside is that they offer less customization compared to what an installed package can provide, since often the main differences between these different charting programs are the indicators and oscillators that can be applied, and how much they can be personalized.
Undoubtedly, the most popular retail forex charting platform is the Metatrader 4 platform, also known as MT4. Indeed, it’s successor, MT5 has appeared in recent yers, but it’s popularity pales in comparison to MT4, despite the company behind the platform (Metaquotes), trying their best to promote the newer MT5. Nevertheless, they both share similar charting features. It would be wise to read up via the various trading forums that go further into detail regarding the differences, which although aren’t that many, are actually profound, such as the lack of backwards compatibility.
The main indicators and oscillators are usually present on even the most basic charting software program, whether Metatrader, or a custom broker’s platform, such as Stochastic, Parabolic SAR and Relative Strength Index (RSI). Others include Moving Average Convergence-Divergence (MACD), Bollinger Bands, and Oscillator Moving Averages (OsMA). These should be present on any decent currency charting program.
Ultimately, the core aim of all these oscillators and indicators is in helping the trader to make decisions on whether to buy or sell a currency pair. Oscillators range between two extreme readings, at one extreme the oscillator indicates a time to sell and at the other, it indicates a time to buy. These oscillators are also known as leading indicators because they attempt to signal the up coming before it has happened. The other type of indicators, mostly based around the prices moving averages, are known as lagging indicators because they only show you what is happening as it happens, they are still very useful and a essential part to a successful technical analysis based trading methodology. Whichever of the many online currency charts a trader decides to use – boils down to personal preference.
