Your book was indeed helpful in understanding forex trading, so helpful that I am about to open an account. However there is one thing which holds me. I do not want trade through dealing desks, but rather through ECN. The brokers, offering ECN trading station, would not provide any charting or historical data. All I have is just a station with quotes. What should I do in such case? How would I test my strategy without seeing what happened yesterday, for instance? Does it mean I must purchase an additional software which would be able to read live quotes, require historical data (from where?)and do some backtesting in order to successfully place order through ECN trading station?
A lot of folks I have heard from or seen on forums have talked about using Metatrader as an alternative charting package when you don’t like what your broker offers – or as in this case, the broker doesn’t offer one at all. Metatrader can be had for free, allows for backtesting, and has the ability to be programmed for automated and other system trading.
That’s obviously one solution.
There are also the larger technical analysis and system testing packages like Metastock and TradeStation. These will cost you money – potentially a sizeable chunk. They are extremely powerful, though, and are consistently rated extremely highly by users. I personally have used Metastock for better than a decade.
There’s one important thing to keep in mind, though. Charting packages require price feeds. Some have them built in. Others require a seperate feed. Either way, there is the issue of variation between the prices which go through the feed and the ones you could actually trade via your broker. This isn’t something which tends to be an issue beyond short-term trading. If you’re in that scalping or sub hour or two type of timeframe it could be an issue. I’ve seen it make a major difference in system performance. Just be aware of that.
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About the Author
John Forman, author of this blog, has traded for more than 20 years, is a professional market analyst, and authored The Essentials of Trading. He is an active participant in trading forums, consults for trading related businesses, as published literally dozens of trading articles, and has been quoted in a number of books and in the media.
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