Best Forex Brokers: Top 10 Reliable Online Brokers For Forex Traders

With the explosion of forex trading as the most liquid financial market in the world, more and more brokers keep cropping up. Although the playing field is vast, it does make it difficult to separate the wheat from the chaff.

Fortunately, we’ve recognized this problem and compiled this article looking into the best forex brokers with seven worthy selections. Choosing a broker is one thing, but being equipped with the right information about successfully navigating the forex world is another.

Therefore, this article is also a valuably educational guide looking at how to start trading forex, choosing a good forex broker, and more.

Our website does not give financial advice and this guide should be used for the sole aim of financial education. It is important to conduct your own research and analysis before making any decisions on your investments to avoid the risk of losing capital.

The Best Online Brokers for Forex Trading in 2022

How to start trading forex

Learning to start trading forex is an intensive process but can be very rewarding in the end. Below are the main steps any potential trader should follow to have the best chance of success.

Learn how the forex market works

Although learning how the forex market works is rather intricate, the fundamental concept is simple. Trading forex is about buying and selling currencies where profits are made from speculating on the differences between the exchange rates.

It takes harnessed skill to consistently predict the likelihood of exchange rates increasing or decreasing in value through the study of technical, fundamental, and other kinds of analysis. Equally important is the ability to know precisely when to place an order, cut losses and take profits.

So, navigating the forex market requires a combination of knowing what moves prices, managing the risks, and maximizing the profit potential.

Choose a broker and a trading platform 

• One of the first steps for navigating the forex world is opening a demo account and choosing the appropriate broker. A demo account is a perfect gateway to learn the art and science of trading without any monetary risk.
  The broker must be reputable and fully regulated to ensure their safety, capitalization, and ability to provide a competitive service.
• Before someone ventures into the actual demo trading after chosing the broker, they should have already understood the basics of the inner workings regarding opening hours, what each of the currency symbols means, the different trends, etc. The trader will also need to learn crucial terminology like margin, leverage, and spreads and how they are interconnected.
• The next phase is deciding on the type of trading style one would pursue, whether it’s scalping, day trading, swing trading, or position trading. Usually, new traders tend to choose any of the former three as the latter is more for the experienced.
  Choosing the right style aligns with the type of strategy, which would naturally be the following progression.
• Regarding trading platforms, MetaTrader 4 is the most widely used in forex. MetaTrader 5 is somewhat popular. Other well-known software packages include cTrader, NinjaTrader, and TradingView.

For simplicity, the MetaTrader platforms are the go-to options. In contrast, the others have a bit more sophistication and might be better choices once a trader has more experience and skill.

One of the detrimental mistakes new traders make is staying for either too long or too short at the demo stage. At least one year is normally sufficient, assuming one can commit at least 2 hours a day studying the charts.

By this stage, the trader should have thoroughly back and forward-tested their strategy and concluded its ability to produce a positive expectancy. Numerous methods such as manual journaling and testing software exist for someone to know how well a strategy is likely to perform in a live setting. This is a step most tend to skip or not give the proper thought it deserves, but it’s crucial to prevent many errors in the real markets.

Technical and fundamental analysis 

The two broad analysis strands in forex are technical and fundamental analysis. Technical analysis refers to analyzing past price action using patterns and indicators to predict future movements. Both methodologies are used in various degrees to essentially forecast where price will go.

This form of observation sets the foundation for entry and exit points. While technical analysis is not easy, it’s more widely used than fundamental analysis. However, it isn’t to say fundamentals are not significant.

Fundamental analysis aims to study the currency’s intrinsic value through mostly economic but also political and social factors. It is these elements fundamental analysts consider the primary drivers of exchange rates.

Since the advent of forex trading, debates continue over which approach is better. In reality, it may not be wise to separate the two, and many traders will include both in their decision-making process.

Familiarise yourself with basic trading strategies 

Strategies in forex are abundant. As with any complex subject, everyone starts with the basics before moving towards the advanced. One of the simplest strategies, which is still widely implemented, is the moving average crossover.

Traders use this system to identify trend changes with a higher-period moving average and a lower-period moving average. While having a strategy is necessary, context is just as important.

When analyzing, traders need to ask themselves how the market is looking at that point in time. If it’s trending, is it a normal trend with normal retracements or a trend with very shallow pullbacks? Is the market in a range, is it approaching a key support or resistance level?

Identifying this information beforehand provides one with an edge as some strategies work better in other conditions than others. Some traders may employ more than one strategy to take advantage of different scenarios or wait until the most optimal condition appears for an individual strategy.

Using discretionary approaches to make decisions can take several years, emphasizing the importance for traders to continually improve their skills. There are several ways one can achieve this.

One way is actively using a journal to track performance and ensure rules are followed to the tee. Another useful tip is looking at less commonly used tools and seeking somewhat unconventional techniques that could provide a heads-up.

Having a brilliant mentor can shorten someone’s learning curve by several years and condense any outstanding information into simple, actionable advice. A trader’s journey is often a marathon than a sprint; the more they learn, the better they should become.

How to choose a good forex broker

Choosing a good forex broker involves logical steps considering several things:

Types of forex brokers 

Because forex is a completely decentralized market without an exchange, we have two main brokerage models. The first is commonly referred to as ECN (Electronic Communications Network) or STP (Straight-Through Processing).

Both terms are often used together but essentially mean the same thing, direct market access through a digital portal of recognized liquidity providers. The second model is the market maker, but some refer to it as a dealing desk or B-book.

Both execution systems present advantages and disadvantages to different traders regarding trading costs, offered accounts, and market conditions. Although the STP model is seen more favorably, which many brokers will base their marketing around, it’s still difficult to confirm as a retail trader.

One way to ensure a broker is reliable is to verify they are duly regulated with a reputable supervisory authority.

These bodies include the likes of CySEC (Cyprus Securities and Exchange Commission), FCA (Financial Conduct Authority), ASIC (Australian Securities and Investments Commission), NFA (National Futures Association), and others primarily from Europe.

Such regulators may have certain policies pertaining to clients from their respective regions, such as leverage limits. In general, non-native traders can rest assured their broker is well-capitalized, safe to make deposits through, and generally act ethically.

Deposits and withdrawals 

Deposits and withdrawals should be treated fairly at all times with forex brokers. Using an unregulated broker or one from an offshore nation with inadequate supervision increases the risks of financial malpractice.

However, using a regulated provider gives confidence to clients in depositing small to vast amounts of money with proper acknowledgment. Traders will also have assurance the broker will be able to process any withdrawals of any magnitude, assuming all terms and conditions have been met.

Check payment options, minimum requirements, commissions

Most brokers provide a plethora of payment options nowadays, including debit and credit cards from numerous payment processors (VISA, Maestro, Mastercard, etc.), Skrill, Neteller, PayPal, and even a few cryptocurrencies. Fortunately, many also do not charge any commissions for the majority of these options.

For convenience and instant clearing, cards and e-wallets tend to be the best ways to fund. A bank transfer, another popular method, isn’t as preferable since it often incurs fees and may take a few days to settle.

Generally, it should be a last resort when all the other choices have been exhausted. The advantage of cards and e-wallets is users can deposit the minimum required by their broker. However much one decides to fund will, of course, depend on their realistic disposable income.

On the other hand, it is useful to note different accounts will require various minimum deposits. For instance, the zero spread option needs at least $200 or even $500; a VIP account may demand a few thousand dollars.

Forex trading conditions

An acclaimed broker will provide favorable trading conditions for their clients in several ways. They will start by offering the most cost-effective spreads to minimize trading costs. Although this is now the standard due to the competitiveness, traders should still compare primarily for exotic pairs where there might be notable differences.

One account type to lower costs overall is the zero spread. It’s not an option offered by the majority of providers, but still beneficial and emphasizes the importance of a broker providing different account types catering to different needs.

For instance, one problem for many traders is low capital. While a standard account accommodates most, a cent or nano account is advantageous, especially for newer traders who don’t have much disposable income and experience.

Another critical point to note is the leverage offered, which also relates to the capital. By and large, the higher the leverage, the less money one needs to put down. Still, it’s just as crucial for a trader to be comfortable with the monetary risk they have per trade regardless of the leverage ratio.

Although having greater margin can leave a trader susceptible to over-leveraging, it’s fully accepting the dollar amount at risk that matters more.

Customer service 

Like any business, excellent customer service is non-negotiable. All brokers should have a functioning and highly responsive live chat function to conveniently and quickly accommodate most of their clients’ inquiries.

This option has certainly reduced the need for telephonic support. If we couple this with a detailed FAQ page on a broker’s website, most questions and issues are typically solved without speaking to someone.

Needless to say, this doesn’t mean helplines aren’t crucial. However, most traders should rely more on live chat and email and use the phone as a last resort.

Reviews from other users

Reviews from other users tend to be subjective and not a reliable indicator. Services such as TrustPilot and Forex Peace Army try their best to provide objective experiences, and some brokers do respond to any constructive assessments from traders.

The key thing to watch out with negative comments if a pattern persists of users complaining about withdrawals. A better option for a recommendation is from a friend or trusted expert who can provide objective encounters and constructive feedback.

Conclusion 

Trading forex is a career and needs to be treated seriously both in terms of the charting aspect and working with a broker. We hope readers will have a sufficient choice into the providers they might consider, along with a wealth of information on other helpful considerations to make.

In formulating this guide, we performed thorough research using each broker looking at their overall safety, features, trading costs, user-friendliness, market range, payment options, and customer support facilities.