Forex Brokers for Day Trading

The foreign exchange market or forex market is the market where currencies are traded. Forex day trading is a way to trade currencies that involves opening and closing positions on currency pairs within the same day. Forex day traders will manage positions over a matter of seconds, minutes and hours. As this can involve placing multiple positions throughout the day, using a suitable forex day trading broker can save you a lot in terms of trading costs and allow you to focus on your forex strategies without any hassle.

What is forex day trading?

Day trading refers to the opening and closing of trades within a single trading day. Meanwhile, forex is a trading instrument that deals with the exchange of currencies to make a profit and can be traded short term and long term.

Forex day trading is when you buy and sell currency pairs throughout the course of the day in order to speculate on the fluctuating prices in the forex market. Most forex day traders will use a combination of technical tools, fundamentals and price action analysis to assist with finding entry and exit points for their buy and sell trades.

The forex market is a popular choice for those starting their day trading journey due to the vast number of currency pairs to trade and the high market liquidity along with the ease at which currencies can be bought and sold using a forex broker.

What are forex day trading brokers?

If you are planning on day trading forex, you will need an account with a forex broker. This will give you convenient access to the forex market via the brokers trading platforms and apps. The broker will have real time price feeds where you can follow the bis/ask prices on the currency market and choose which pairs you would like to trade.

Is the forex market good for day trading?

I think the forex market is one of the best financial markets for day trading because it has plenty of trading volume. In fact, the foreign exchange market is the world’s largest financial market where trillions are traded daily.

However, day trading is more suited towards forex traders that have plenty of time throughout the day to analyse, execute and monitor trades. You will need to spend a lot of time learning how the FX market works and studying charts.

Some common mistakes that are committed by day traders are not doing proper research, overtrading, following too much on recommendations, over leveraging traders, having poor money management and a lack of controlled emotions.

Trading currencies is very different from trading stocks or commodities and it can take years until you start seeing consistent results. A demo forex account can be a great place to start as this will enable you to practice your day trading strategies without any risk until you build enough confidence to open a real live trading account.

How much money can I make day trading forex?

It is impossible to say how much you can make day trading forex because it depends on so many different factors. Whilst using a good forex broker for day trading can save you in terms of costs, it cannot improve the quality of your forex trading strategies.

If you have a solid strategy, good discipline and sensible money management, you can increase your chances of becoming a successful forex day trader. However, there can be no guarantees on how good or bad any day trading strategy will perform as anything can happen when it comes to trading.

Day trading forex vs day trading stocks

The currency markets are generally more accessible than stock markets. Traders can trade stocks nearly 24 hours a day from Monday through Friday, but it isn’t particularly easy to access all those of markets although online stock brokers have made things easier. On the other hand, forex trading is much more convenient to do around the clock, 24/5.

The forex market is far more volatile than the stock market, where profits can be attainable from experienced and patient investors. Forex trading also comes with high leverage which can increase the risks and new traders are not always aware of the importance of good money management.

I would say that trading the forex market has some benefits compared to the stock market, which makes it suitable for a larger group of people due to its flexible hours, lower fees, and higher trading volume. Not to mention, there are literally hundreds of forex brokers with user-friendly platforms for day trading forex.

Who are the best forex day trading brokers?

The best forex broker for day trading is going to depend on what type of forex strategy you are using. For instance, if you are using a scalping strategy, then you will want to consider a forex broker for scalping that has low spreads, low costs and reliable execution speeds. You should make sure the broker has all of the currency pairs and other financial instruments that you wish to trade along with convenient payment options and excellent support. You can see a selection of our best day trading brokers in the table below.

Broker
Rating
Regulated
Min. Deposit
Founded
Max. Leverage
1.
AvaTrade Review

ADGM FRSA, ASIC, BVIFSC, CBI, FFAJ, FSCA, IIROC, JFSA

$100

2006

1:400

Between 74-89% of retail investor accounts lose money when trading CFDs with this provider.
2.
IG Review

ASIC, BaFin, CFTC, DFSA, FCA, FINMA, FMA, FSA, FSCA, JFSA, MAFF, MAS, METI, NFA

$250

1974

1:200

76% of retail investor accounts lose money when trading spread bets and CFDs with this provider.
3.
Pepperstone Review

ASIC, BaFin, CMA, CySEC, DFSA, FCA, SCB

$200

2010

1:400

Between 74-89% of retail investor accounts lose money when trading CFDs with this provider.
4.
IC Markets Review

ASIC, CySEC, FSA, SCB

$200

2007

1:500

Between 74-89% of retail investor accounts lose money when trading CFDs with this provider.
5.
XM Group Review

ASIC, CySEC, DFSA, IFSC

$5

2009

1:888

Between 74-89% of retail investor accounts lose money when trading CFDs with this provider.
6.
City Index Review

ASIC, FCA, MAS

$100

1983

1:200

Between 74-89% of retail investor accounts lose money when trading CFDs with this provider.
7.
BlackBull Markets Review

FMA, FSPR

$200

2014

1:500

Between 74-89% of retail investor accounts lose money when trading CFDs with this provider.
8.
FP Markets Review

ASIC, CySEC, FSCA, SVGFSA

$100

2005

1:500

Between 74-89% of retail investor accounts lose money when trading CFDs with this provider.
9.
Forex.com Review

ASIC, CIMA, CFTC, FCA, FSA, IIROC, JFSA, NFA, SFC

$100

2001

1:50

Between 74-89% of retail investor accounts lose money when trading CFDs with this provider.
10.
XTB Review

CySEC, DFSA, FCA, FSCA, IFSC

$1

2004

1:500

Between 74-89% of retail investor accounts lose money when trading CFDs with this provider.

Forex day trading pros & cons

Pros

  • Lots of buying and selling opportunities
  • Plenty of currency pairs to trade
  • Can be a quick way to compound an account
  • Easily accessible via intuitive trading platforms and apps
  • Plenty of trading tools to assist with market analysis
  • Hundreds of forex day trading brokers to choose from
  • Demo accounts available to practice your strategies
  • No swap-fees if you don’t hold positions overnight

Cons

  • Requires time to learn and practice
  • Can take some time to see consistent results
  • Trading costs can add up when trading frequently

Conclusion: do I need a forex broker for day trading?

Yes, if you are looking to trade currencies on a daily basis, then you will need a day trading forex broker. As day traders look to take advantage of relatively small price moves, the cost to open each position can have a significant impact on its result. You will want to look around for a broker with tight spreads, low commission fees and rapid trade execution speeds. These are all factors that can have a significant impact on forex day trading strategies. If you plan on swing trading and holding positions for days, weeks or months, then you may want to look at our best forex brokers for some alternative options.


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