Forex Trading in Malaysia 2020 – Tutorial and Broker

Forex trading is a huge market. Billions are traded in foreign exchange every day. Whether you are an experienced trader or an absolute beginner, finding the best forex brokers and trading strategies or profitable day trading systems is complex. So learn the basics before choosing the best path for  you .

With this introduction, you will learn general forex trading tips and strategies used for online currency and forex trading. It will also highlight potential pitfalls and helpful hints to ensure you know the facts. Finally, use the list of trusted brokers to compare the best forex platforms for day trading in Ukraine 2020.

Read on to find the AZ of forex, how to start trading, and how to evaluate the best platforms.

Why Forex Trading?

The forex currency market offers day traders the ability to speculate on movements in the foreign exchange market and a particular economy or region. Also, without a central market, forex offers round-the-clock trading opportunities.

• Liquidity – In the forex market there is an average amount of more than $ 3.2 trillion dollars traded every day. So, there are many trades and moves you can make.
• Diversity – First, you have pairs stemming from eight major world currencies. Additionally, many regional currency pairs are also available for trading. More options, more opportunities to make a profit.
• Accessibility – The forex market is easily accessible, open twenty-four hours a day, five days a week. So you decide to trade and how to trade.
• Leverage – Most forex currency pairs are traded on margin. This is because leverage can be used to help you buy and sell large amounts of currency. The greater the quantity, the greater the potential profit or loss.
• Low commissions – Forex offers relatively low costs and fees compared to other markets. In fact, some firms don’t charge any commission at all, you just pay the bid/ask spread. Real ECN firms can also offer 0 spreads!

Currency Traded In Forex

Major

In the world of international day forex trading, the majority of people focus on the seven most liquid currency pairs on earth, the first of which are the four ‘majors’:

• EUR / USD (euro / dollar)
• USD / JPY (Japanese dollar / yen)
• GBP / USD (British pound / dollar)
• USD / CHF (dollar / Swiss franc)

In addition, there are three newly emerging couples:

• AUD / USD (dollar / Australian dollar)
• USD / CAD (dollar / Canadian dollar)
• NZD / USD (dollar / New Zealand dollar)

This currency pair, in addition to various other combinations, accounts for more than 95% of all speculative trading in the forex market, as well as retail forex.

However, you will likely find the US dollar prevalent in major currency pairs. This is because it is the world’s main reserve currency, playing a role in about 88% of currency trading.

Minor

If the currency pair does not include the US dollar, it is known as a ‘minor currency pair’ or ‘cross currency pair’. Therefore, the most traded minor currency pairs include the British pound, the Euro, or the Japanese yen, such as:

• EUR / GBP (euro / British pound)
• EUR / AUD (euro / Australian dollar)
• GBP / JPY (British pound / Japanese yen)
• CHF / JPY (Swiss franc / Japanese yen)

You can also delve into trading exotic currencies such as the Thai Baht and the Norwegian or Swedish krone. However, exotic additions bring them with higher risks and uncertainties.

 

Finding the Best Forex Brokers

The “best” forex broker will often be a matter of individual choice. It will probably come down to the pair you need to trade, the platform, trading using a spot market or a point or ease of use needs.

Here is a list of comparison factors, some will be more important to you than others but all are worth considering. Details on all these elements for each brand can be found in individual reviews.

Lowest Trading Cost

Spreads, commissions, overnight fees – everything that reduces your profit in one trade needs to be considered. High frequency trading means these costs can add up quickly, so fee comparisons will be a big part of your broker selection. Inactivity or withdrawal fees are also worth noting as they can be another drain on your balance.

Trading Platform

The trading platform needs to be tailored to you. Whether you want a simple interface, or multiple built-in features, widgets and tools – your best choice may not be the same as everyone else’s. Learn more about forex trading platforms here.

A Demo Account is a great way to try different platforms and see which one works best for you. Remember, too, that many platforms are configurable, so you’re not stuck with the default view.

Mobile Commerce

Moving forex trading is very important for some people, less so for others. Most brands offer mobile apps, usually compatible across iOS, Android and Windows.

If this is key for you, then check the app is the full version of the website and doesn’t miss any important features. Downloading this app is generally quick and easy – brokers want you to trade. Read more about forex trading apps here.

Customer service

Is customer service available in your preferred language? Is there live chat, email and phone support? When will they be available? How high this priority is, only you can know, but it should be checked.

Asset List

Does the broker offer the market or currency pair you want to trade? Very basic inspection, this one. If you trade major pairs, then all brokers will accommodate you. If you want to trade with Thai Baht or Swedish Krone, you need to review the list of assets and currencies that can be traded.

Rules

Do you want the broker to be regulated by a specific body – perhaps the FCA, SEC or ASIC? Remember European rules may affect some of your leverage options, so this may affect more than just your peace of mind. We cover the rules in more detail below.

 

Spread Or Commission

Some are covered in trading costs, but the spread is often a comparison factor in itself.

This is because you are not tied to one broker. If you trade 3 or 4 different currency pairs, and there is no single spread broker tucked away for all of them, then shop around. There is no harm in having several accounts to take advantage of the best spread on each trade. Beware of wider ‘hidden’ spreads spreading too often.

payment method

The deposit method options at certain forex brokers may interest you. Do you want to use Paypal, Skrill or Neteller? Are you happy to use a credit or debit card knowing this is where withdrawals will also be paid?

Some forex brokers now accept deposits in Bitcoin or various other cryptos as well.

Safety

Most brands will follow regulatory demands to separate customer and company funds, and offer a certain level of user data security.

Some brands may give you more confidence than others, and this is often linked to the regulator or where the brand is licensed. Forex trading can attract unregulated operators. Safety is a good consideration.

Demo Account

Try before you buy. Most reputable brokers are willing to let you view their platform risk free. Trading on a demo or simulator account is a good way to test a strategy, retest or learn the nuances of the platform. Try as many as you need to before making a choice – and remember having multiple accounts is fine (even recommended).

Account Type

From cash, margin or PAMM accounts, to Bronze, Silver, Gold and VIP levels, account types can vary. The difference can be seen in cost, reduced spreads, access to Level II data, different solutions or leverage. Micro accounts may provide lower trade size limits for example.

Retail forex and professional accounts will be treated very differently by both brokers and regulators for example. An ECN account will give you direct access to the forex contract market. So research what you need, and what you get.

Leverage

For European forex traders this can have a big impact. Leverage Forex is closed at 1:30 by the majority of regulated brokers in Europe. Assets such as Gold, Oil or stocks are restricted separately.

In Australia however, traders can use leverage of 1:500. That makes a big difference to deposits and margin requirements. Australian brands are open to traders from all over the world, so some consumers will have a choice between regulatory protection or more freedom to trade as they wish.

Keep in mind that higher leverage increases potential losses, just as much as potential gains.

Tools Or Features

From price matching to futures prices or previous trading robots, brokers offer a variety of tools to enhance the trading experience. Again, this availability as a determining factor in opening an account will come down to the individual. Level 2 data is one such tool, where priority may be given to the brand that delivers it.

Education

Forex trading beginners in particular, may be interested in the tutorials offered by the brand. This can be in the form of e-books, pdf documents, live webinars, expert advisors (ea), courses or full academic programs – whatever the source, it’s worth assessing the quality before opening an account. Keep in mind forex companies want you to trade, so will encourage trading regularly.

MetaTrader 4 or 5

Integration with popular software packages such as Metatrader 4 or 5 (MT4 or MT5) may be important for some traders. Many brands offer automated trading or integration into related software, but if you want to rely on it, you need to be sure.

Bonus

From cashback, to no deposit bonuses, free trades or deposit contests, brokers used to offer many promotions. Regulatory pressures have changed all that. Bonuses are now few and far between. Our directory will list them where offered, but they can rarely be the deciding factor in your forex trading choices. Also always check the terms and conditions and make sure they won’t cause you to over trade.

Execution Speed

Desktop platforms will usually provide excellent execution speed for trading. But mobile apps may not. While this isn’t always the fault of the broker or the app itself, it’s a worthwhile test.

 

Fraud

Our reviews have filtered out scams, but if you’re considering a different brand, avoid getting caught with this check;

• Are you ‘cold called’? Reputable firms will not call you out of the blue (This includes email, or facebook or Instagram channels)
• Are they offering unrealistic gains? Just stop and think for a moment – ​​if they can make the money they claim, why are they calling or advertising on social media?
• Do they offer to trade on your behalf or use their own or self-managed transactions? Don’t give someone else control of your money.

If you have doubts, go ahead. There are many legitimate brokers.

With all the comparison factors presented in our review, you can now list your best forex brokers, take each for a test drive with a demo account, and choose the best one for you. We rank brokers according to our own opinion and offer ratings in our table, but only you can give ‘5 stars’ to your favorites!

Read who won DayTrading.com’s ‘Best Forex Broker 2020’ on the Awards page.

Forex Broker Reviews

Use this table of top forex broker reviews to compare all the FX brokers we’ve reviewed. Note that some of these forex brokers may not accept trading accounts opened from your country. If we can determine that the broker will not accept your location, it is marked in gray in the table.

Forex Rules

Regulation should be an important consideration. Whether regulators are inside, or outside, Europe will have serious consequences for your trade. ESMA (European Securities and Markets Authority) has imposed strict regulations on regulated forex firms in Europe. These include the following regulators:

• CySec (Cyprus Securities and Exchange Commission)
• FCA (Financial Conduct Authority)
• BaFin – (Bundesanstalt für Finanzdienstleistungsaufsicht)
• Swiss Financial Market Supervisory Authority (Switzerland)

ESMA has jurisdiction over all regulators in the EEA

Regulations include caps or limits on leverage, and vary across financial products. Forex leverage is limited to 1:30 (Or x30). Outside Europe, leverage can reach 1: 500 (x500).

Traders in Europe can apply for Professional status. This removes their regulatory protection, and allows brokers to offer higher levels of leverage (among other things).

Outside of Europe, the biggest regulators are:

• SEC – Securities and Exchange Commission (US)
• CFTC – Commodity Futures Trading Commission (US)
• CSA – Canadian Securities Administration
• ASIC – Australian Securities and Investments Commission

This covers most of the countries outside of Europe. Forex brokers residing in India, Hong Kong, Qatar and so on may have regulations in one of the above, rather than every country they support. Some brands are regulated worldwide (some are regulated on 5 continents). Some bodies issue licenses, and others have a register of law firms.

So to reiterate, ASIC forex brokers can offer higher leverage to traders in Europe.

Which Currencies Should You Trade?

Investors should stick to major and minor pairs initially. This is because it will be easier to find trades, and lower spreads, making scalping viable.

 

 

Exotic pairs, however, have more liquidity and a higher spread. In fact, because they are riskier, you can make serious cash with exotic pairs, just be prepared to lose in just one session.

See Live forex rates here.

How to Trade Forex?

The logistics of day trading forex are almost the same as every other market. However, there are important important differences. When you day trade in forex you buy a currency, while selling another at the same time. Therefore that is why currencies are marketed in pairs. Therefore, the currency exchange price you see from your forex trading account represents the purchase price between the two currencies.

For example – the rate you find for GBP / USD represents the amount of US dollars one British pound will buy. Therefore, if you have reason to believe the pound will appreciate against the US dollar, you will look to buy pounds with US dollars. However, if the exchange rate rises, you will sell your money back and make a profit. The same goes for the Euro, Yen and others

Contract

Forex contracts come in different types:

• Spot forex contracts
  • Conventional contracts. Delivery and settlement is prompt.
• Futures forex contracts
  • Shipping and settlement takes place on a future date. The price is agreed directly, but the actual exchange is in the future.
• Currency swaps
  • Where two parties can ‘exchange’ currencies, usually in the form of loans, or loan payments in different currencies.
• Option forex contracts
  • Options give traders the option (but not the obligation) to exchange a currency at a certain price at a date in the future.

Forex orders

There are various forex orders. Some are common, others less so. Using the right one can be important.

The two types of forex orders are:

1. spot order or market order

2. Unfinished orders

Instant Order / Market Order

This is implemented immediately at market prices.

A Buy is an order to ‘go long’ or profit from a rising market. A Sell means opening a short position with the expectation that the value will fall.

Unfinished orders

A Stop loss is a preset level at which the trader will like the trade to be closed (stop out) if the price moves above them. It is an important risk management tool. It instructs the broker to close the trade at that level. Guaranteed clearing means the firm’s guarantee to close the trade at the requested price.

Unsecured stops can ‘slip’ in volatile market conditions, and the trade is closed, close to, but not at, the stop level. The unpegged Swiss Franc (CHF) shock was one such event.

A Trailing Stop asks the broker to move the stop loss level along with the actual price – but only in one direction. So a long position will move the stop in a rising market, but it will stay where it is if the price falls. It allows traders to reduce potential losses at good times, and ‘lock in’ profits, while maintaining a safety net.

A take profit or Limit Limit is the point at which the trader wants the trade to be closed, in profit. It is a good tool for discipline (closing trades as planned) and key to certain strategies. It is also very useful for traders who cannot watch and monitor trades all the time.

One Cancels the Other

A One Cancels the Other (OCO) Order is a combination of a Stop and Limit order, but if one is triggered, the other order is discarded or cancelled. It is an important type of strategic trade.

Cryptocurrencies

Leading cryptocurrencies such as Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC) and Ripple (XRP) are often traded as currency pairs against the US dollar. These can be traded just like any other FX pair. Their exchange value relative to each other is also sometimes offered, for example BTC / ETH or ETH / LTC etc.

Chart

Charts will play an important role in your technical analysis. Therefore, you need to find a time frame that allows you to recognize opportunities easily. In fact, a proper chart will paint a picture of where the price might be headed going forward. For example, day trading forex with intraday candlestick price patterns is very popular.

See our charts page for more guidance.

Strategy

Any effective forex strategy needs to focus on two key factors, liquidity and volatility. These are the two best indicators for any forex trader, but short-term traders rely heavily on them.

Intraday trading with forex is very specific. While your average long-term futures trader might be able to throw in 12 hedges (the smallest price move is usually 1%) here and cut 12 there, day traders can’t. This is because those 12 pips can be the entire expected profit on the trade.

Accuracy in forex comes from the trader, but liquidity is also important. Liquidity does not mean that the order will not be closed at the ideal price, regardless of how good a trader you are. As a result, this limits day traders to certain trading instruments and times.

Volatility is the size of market movements. Therefore, firm uncertainty for traders will reduce the choice of instruments to currency pairs, depending on the session. Because volatility is session dependent, it also brings us to the important component outlined below – when to trade.

When To Trade

Despite being able to trade 24 hours a day, 5 days a week, you can’t (Forex trading is not enough 24.7). You should only trade currency pairs when they are active, and when you have enough volume. Weekend forex trading will see small volumes. Take GBP/USD for example, there are certain hours where you have enough volatility to create a profit that may negate the bid price spread and commission costs.

The forex market is alive 24 hours a day because there are always global markets open everywhere, due to different time zones. However, not every market actively trades all currencies. As a result, other forex currency pairs are actively traded at different times.

For example, when the UK and Europe open, the pair consisting of the euro and the pound is down with trading activity. However, when New York (US and Canada) are on their desks, pairs involving the US dollar and the Canadian dollar are actively traded.

So, if you trade the EUR / USD pair, you will get the highest trading activity when New York and London open, or Tokyo for JPY and Sydney for AUD.

Use the forex daily chart to see key market hours in your own time zone. The image below shows market opening times (and session closes) for London, New York, Sydney and Tokyo. Crossover periods represent sessions with the most activity, volume and price action.

Forex Trading Session

Each session has a unique ‘feel’:

• Asia Session: Made from the Asian market, opened in New Zealand and Australia and moved west. These sessions produce lower volumes and smaller ranges. JPY, NZD and AUD are popular markets and news events can move prices significantly.
• The London (‘European’ Session): Actually starts in Frankfurt, and London an hour later. The UK opening saw greater volume in the Forex market, plus volatility will drop during the session. European institutions, banks and account managers will be active and macroeconomic data released.
• New York (US) session: This opens at 9.30am New York time, but US fundamental data could be released at 8.30am. This can make the initial volume before the ‘official’ 9:30 opening.

The London and New York ‘crossover’ sees the most volatility and liquidity. Important fundamental data is released, financial institutions trigger forex contracts and ‘smart money’ is involved.

Signals or Trading Signals

Forex signals or signals are sent in various ways. User-generated alerts can be made to ‘pop up’ through simple broker trading platform tools, or more complex third-party signal providers that can send trader alerts via SMS, email or direct message. Regardless of the mechanism the goal is the same, to trigger a trade once certain criteria are met.

This criteria usually depends on the chart pattern and / or candlestick screening. Our chart and pattern pages will cover this theme in more detail and are a great starting point. Paying for signal services, without understanding the technical analysis that drives them, is high risk.

It’s impossible to rate a service, if you don’t understand it.

Traders who understand indicators like Bollinger bands or MACD will be more than capable of establishing their own signals.

But for the time poor, paid services  may pay  off. You certainly need enough time to actually place trades, and you need to be confident with the provider.

It is unlikely that someone with a profitable signal strategy is willing to share it cheaply (or at all). Beware of promises that seem too good to be true. You can read more about automated forex trading here.

 

50 pips a day

If you download a pdf with a forex trading strategy, this will probably be one of the first things you see. Beginners can also benefit from this simple but robust technique as it is not an advanced trading strategy. However, before venturing into any exotic pair, it’s worth putting it through its paces with the main pair.

Therefore, when the candle closes at 07:00 (GMT), you need to place two pending orders. First, place a buy stop order 2 pips above the high. Then place a stop order 2 pips below the low of the candlestick. Once the price activates one of the orders, cancel the one that hasn’t been activated yet.

Additionally, make sure you place a stop loss order anywhere between 5-10 pips above the 07:00 high / low. This will help you manage your trading risk. Now set your profit target at 50 pips. At this point, you can kick back and relax while the market gets to work.

If the trade reaches or exceeds the profit target by the end of the day then all is gone to plan and you can repeat the next day. However, if the trade has floating losses, wait until the end of the day before exiting the trade.

But for a more detailed example, see our strategy page in intraday trading techniques.

 

 

Forex Trading Software

There is a huge selection of software for forex traders. Cost and benefits will be key considerations, and we look at several software platforms in detail on this site:

• MetaTrader 4
• AlgoTrader
• TradingView
• NinjaTrader
• The platform is for Mac or Windows users, and there are dedicated applications for Linux.
• Social trading platforms (or ‘Copy trading’) are another variety of software related to forex trading. The main pioneers of such services are:
• eToro
• ZuluTrade

We are expanding the options for software trading platform platforms and on our Software page.

Education

If you want to increase your forex trading salary today, you should also use various educational resources:

• Books – You can find books on profitable strategies, books on scalping, rules, price action, technical indicators, and more. In addition, there are many specialized books. So, you can find the best books on strategy for beginners or two-step trend analysis, for example.
• Chat rooms & forums – Live day trading forex forums are a great way to learn from experienced traders. Some will even share their best free trading systems. Just be careful with the quality of the advice.
• Blog – If you want to hear success stories from forex millionaires, then the forex day trading blog might be the place to go. Again, tread carefully with the advice offered.
• Forex websites – There are several dedicated forex websites. Some offer free signals, techniques to find trend lines and set up your platform.
• PDF – Online you will find several PDF forex trading systems. Unlike live chat rooms, charts are often provided to support written descriptions.

Tips

Financial management

The most profitable forex strategy will require an effective money management system. One technique that many suggest is never to trade more than 1-2% of your account in one trade. Therefore, if you have $10,000 in your account, you will not risk more than $100 to $200 on an individual trade. As a result, a string of bad decisions won’t blow all your capital.

Then when you have developed a consistent strategy, you can increase your risk parameters. The Kelly criteria is a separate plan that needs to be studied.

Automation

Automated Forex trading can increase your returns if you have developed a consistently effective strategy. This is because instead of manually entering a trade, an algorithm or bot will automatically enter and exit after pre-set criteria. Additionally, there is often a minimum account balance required to set up an automated system.

However, those looking at how to start trading from home may need to wait until they have honed an effective strategy first.

For more guidance, see our automated trading page.

Tax

When you read blogs about forex traders, such as ‘a day in the life’, they often leave behind tax implications. In fact, it is important that you check the rules and regulations where you are trading. Failure to do so may lead to legal issues.

See our tax page for more information.

Webinars & Training Videos

They are the perfect place to get help from experienced traders. This is because forex webinars can guide you through setup, price action analysis, plus the best signals and charts for your strategy. In fact, in many ways, webinars are the best place to go for hands-on guidance on the basics of day currency trading.

3 Mistakes To Avoid

1. Average

Although you may not initially intend to do so, many traders end up falling into this trap at some point. The biggest problem is that you are holding a losing position, sacrificing both money and time. Although it may come a few times, eventually, it will lead to a margin call, because trends can last longer than you can stay liquid.

This is a major problem for day traders because the limited timeframe means you have to take advantage of opportunities as they come and get out of bad trades quickly.

 

2. Trading Too Soon After the News

Big news comes and then the market starts to go up or down quickly. At this point, it may be tempting to train easy, but doing so without a disciplined trading plan behind you can ruin the gamble before the news gets out. This is because liquidity and sharp price movements mean that trades can quickly translate into significant losses when a large swing occurs or ‘whipsaw’.

The solution – wait for the volatility to subside and you can confirm the trend.

3. Days of Interest

It’s great to have a method and system of trading that works once a day. However, even a consistent strategy can go wrong when faced with the incredible volume and volatility seen on any given day. For example, public holidays like Christmas and New Year, or days with big news events, can open you up to volatile price fluctuations.

Country

The country or region in which you trade with forex can present certain issues. For example, forex traders in the United States and Canada need to read the pattern trading rules (Canadian traders have it a little easier).

Trading in South Africa is probably safest with FSA regulated (or registered) brands. Areas classified as ‘unregulated’ by European brokers see way less ‘default’ protection. Therefore local regulators can provide additional confidence. This is similar in Singapore, the Philippines or Hong Kong. Therefore, the choice of ‘best forex broker’ will vary by region.

Trading forex in poorly regulated countries, such as Nigeria and Pakistan, means leaning towards more established European or Australian regulated brands.

Forex Trading; Is It Profitable?

Many people question what a trader’s salary is. However, the truth is very different. The majority of people will work hard to make a profit and will eventually give up. On the other hand, a small minority proves not only that it can make a profit, but that you can also make big returns. So, it is possible to make forex trading money, but there is no guarantee. 75-80% of retail traders lose money.

Anyway

Currencies are a larger and more liquid market than the US stock and bond markets combined. In fact, the abundance of opportunities and financial leverage make it attractive to anyone who wants to day trade forex.

Unfortunately, there is no one best strategy for forex trading. However, trade at the right time and keep volatility and liquidity at the forefront of your decision making process. Follow the general rules for day FX trading and you’ll be on the right track