Features of the FXCM Web Platform

[RichardCox 10]

FXCM is one of the most well known and widely used brokers in the forex industry and at some stage, most traders have come across some sort of news analysis or technical analysis strategy that has been published by one of its authors. But even with this large (possibly the largest) web presence, it was relatively surprising to see FXCM wait as long as it did to offer its clients a trading platform that did not need to be downloaded directly onto a PC.

 

To be sure, when looking at the features of FXCM’s web based platform, it is clear that the company was going for a very bare bones approach that is designed essentially for placing trades and little else. More advanced technical and fundamental analysis will have to be conducted in other areas, and in the following sections we will look at why this is the case.

 

Platform Order Types

 

First, we will look at the various order types that are offered on the platform, as this is one its its strengths when compared to some of its industry competition. While the platform does allow for the execution of basic orders (market orders, stop orders, limit orders and entry orders) directly from the chart, there are more advanced orders as well and this is something that is not seen on all web based platforms.

 

Specifically, these come with three choices: The first is the At Market and Market Range order, which are used when traders are looking for increased price certainty and execution validity. Second is the Simple OCO order, which allows traders to easily create two linked entry orders that straddle the current market price. Third is the Complex OCO order, which allows traders to manually link two or more orders (which cannot be done as quickly as the Simple OCO order).

 

Platform Trading Modes

 

Overall, the platform is definitely dedicated to increased order flexibility and this also becomes clear in the three platform trading modes that are available on the offering. In order to make accommodations for different types of trading styles, the web platform allows traders to choose between click and confirm orders, one click orders and double click orders, and each method has its own set of advantages.

 

The one click order is best for very short term strategies (scalping), as is allows traders to enter and exit positions with a single mouse click. While it is much easier to get in and out of positions, a greater level of care must be used in order to avoid mistakes. For more conservative traders worried about these issues, the click and confirm option can be used. Here, traders verify their order levels before any order is submitted and for conservative traders this “mistake prevention” will be viewed favorable. A happy medium between these two modes is the double click mode, which can be done more quickly and will not create as many mistakes as the single click mode.

 

Platform Charting Software

 

Unsurprisingly, FXCM touts its charting package as “powerful” and says that “high-end” packages of this type are usually found in expensive, subscription based offerings. But when looking at the actual charting software, these descriptions don’t ring quite as true. While there is the ability for technical traders to overlay some of the most commonly used indicators, the overall list available isn’t exactly inspiring.

 

This indicator list includes roughly 50 options, with many of the old favorites: SMAs/EMAs, Bollinger Bands, MACD, ADX, RSI, Stochastics, etc. At the same time, the chart elements that are offered include Fibonacci Retracements and Time Zones, Gann Fans, Trend Lines, the Andrews Pitchfork, as well as equidistant and regression channels.

So while most of the basics are covered, traders with more advanced technical analysis strategies will likely need to use an alternative charting package in order to conduct their analysis.

 

So while this is a general feature of most web based platforms, it does not change the fact that FXCM (even as one of the most well established companies in the business) has yet to offer a more advanced charting package. One later feature has been the ability to trade directly from the chart (and to manage trades from the chart once they are open), streamlining the process. But, overall, FXCM’s web offering offers little in the way of advanced technical analysis capabilities.

 

Trade Execution and News Feeds

 

A general concern with the use of web based platforms is the fact that order execution can suffer without the use of a downloaded platform. Fortunately, FXCM has one of the most respected reputations for trading executions in the business. This is largely a result of FXCM’s no dealing desk execution model, as this give traders a much deeper liquidity pool when trade are actually placed. Because of this, there is less lag time when trades are opened and in sending confirmation orders for those positions.

 

But where the platform outshines some of its competition in execution, areas of weakness can be seen in the lack of a news feed that is part of the web based offering. This is truly a glaring omission, as there are other (and very well known) forex brokers that have offered quality news feeds for years. When looking at the platform, there is a “Research” button, which takes you to FXCM analysis website but in many cases, economic releases and other news headlines are not immediately updated.

 

This does pose some potential problems when news related volatility picks up, so when using a strategy that is sensitive to this type of information, a trader would need to use an alternative source in order to know what is moving the market at that moment and to receive the result for macro economic data.

 

Conclusion: An Efficient Platform Focused on Placing Trades, Not Analysis

 

So when looking at the FXCM web platform as a whole, it does become clear that the intention is for trades to be placed in a fast and efficient manner, rather than on conducting the analysis that might be behind those trades. So, if your trades tend to be based on simple support and resistance levels, or on Fibonacci retracements, there is nothing wrong with the platform capabilities.

 

On the other hand, if you tend to implement more advanced technical analysis strategies (such as the use of harmonic patterns) or if you tend to watch news events to manage your trades once positions are opened, it might be more wise to either use FXCM’s downloadable platform or to find a broker that allows for the extra platforms features.