In this article, we're going to look at three critical elements that you need to understand in order to effectively use the MT4 MetaTrader platform to trade the forex market:
– First, we're going to be discussing how to make sure you can see all available instruments to trade.
– Next, I will go over how to tap into exploiting one of the best kept secrets concerning MetaTrader, combining indicators so that an indicator is commenting on the performance of another indicator.
– Lastly I will go over one of the best ways to exploit pips in a move, trailing stops. Afterwards you'll be able to tackle the platform with confidence and ability to begin successfully trading using MT4.
First, let's deal with the issue of pair availability. When you first install MetaTrader (MT4), you do not see all available pairs that your broker offers. I have no idea why but could be dangerous depending on your trading style. Quite a few traders look at one currency pair to see what the other will do. This is called correlation. For example, if the EURUSD is going up, then typically the USDCHF is going down. You might see a clear pattern on the USDCHF chart but not on the EURUSD. Because of that observation, you have a high degree of confidence that the EURUSD will move in the opposite direction of the pattern seen in the USDCHF charts. By having all available charts at your disposal you increase your trading styles and choices.
Prior to initiating that trade with the EURUSD or USDCHF based on correlation that we previously discussed, you may choose to add and combine indicators. By doing this you may be able to get additional insight and increase the probability of success. After you have placed your first indicator on the chart, you then want to drag and drop the second indicator from the Navigator window directly on top of the first (remember you can only combine indicators within the same part of the chart). Once the indicator's setting window pops up you want to select the "Apply to:" box and choose "First Indicator's Data". Here is a practical example: Suppose you have the Volume indicator on the charts and want to see what the average is over 10 periods. You have an idea that you will initiate a trade whenever volume volumes this average by 2x. First drag the Moving Average indicator from the navigator window and drop it over the Volume Indicator. Select First Indicator's Data from the Apply to field and that's it. Now the moving average line is looking at volume instead of price (which it defaults to). Take some time to experiment with combinations as one may particularly strike your fancy.
Finally let's talk about protecting your hard earned profit. Now that you've hit the trigger and placed a trade, you can now implement a tool to ensure you do not want to give a single pip back to the market. You can do this by placing a trailing stop to your order. Trailing stops follow the market and move your stop loss based on your settings. Right click on the trade in the terminal window and choose "Trailing Stops". Then you are free to choose the level that is appropriate based on your trading timeframe. Once done the system will automatically move your stop loss as the market moves in your favor, locking in profit and protecting you. One thing that is critical to note is that this feature only works if your computer is turned on. If you turn off your computer, the feature will stop working.
Going through this tutorial, these three elements will help you navigate your way through learning MetaTrader and give you the basics to get started with confidence.