How to Enter a Trade on MT4 and MT5?
Do you know how to enter a trade on MT4 and MT5?
Let’s start from the beginning.
MT4 and MT5 refer to MetaTrader 4 and MetaTrader 5, which are popular electronic trading platforms used by traders in the financial markets.
Both MT4 and MT5 are developed by MetaQuotes Software Corp.
MetaTrader 4 (MT4) is the older version. It is quite popular among retail forex traders. What’s interesting, it is known for its user-friendly interface and comprehensive features, making it a popular choice among traders.
It allows users to trade various financial instruments such as currencies, commodities, indices, and cryptocurrencies.
As a reminder, MT4 provides real-time market quotes, advanced charting tools, technical analysis indicators, and the ability to develop and use automated trading systems called Expert Advisors (EAs). It also supports mobile trading on smartphones and tablets.
What about MT5?
MetaTrader 5 (MT5) is the successor to MT4 and was introduced in 2010. While MT5 shares similarities with its predecessor, it offers several improvements and expanded capabilities.
We need to mention that MT5 not only allows trading in the forex market but also provides access to other financial markets such as stocks, futures, and options.
MT5 offers more advanced charting features, additional technical indicators, and a more flexible trading system. It also supports the development and use of EAs, similar to MT4. Additionally, MT5 features a built-in economic calendar and a strategy tester for backtesting trading strategies.
How to enter a trade on MT4?
Let’s get back to the question, “How to enter a trade on MT4?”
Let’s look at how to trade forex using MT4. The simplest way to open a trade in MetaTrader 4 is to use the ‘Order’ window and then place an instant order on the market.
Pick the currency pair of your preference by clicking on the ‘Window’ tab at the top of the MT4 platform and then pick ‘New Window.’
Importantly, you can then click ‘New Order’ on the MT4 toolbar or press F9 in order to open an ‘Order’ window.
Do you know how to enter a short position on MT4?
Going short (or short selling) on the market is simply selling when you don’t have a long position. In order to do so, you would simply need to place a sell trade to open.
We also need to cover one important topic. Do you know how to close a trade on MT4?
Pick the ‘Trade’ tab from the ‘Terminal’ window (press CTRL+T to summon or dismiss the ‘Terminal’ window).
You will notice any open trades you have displayed in the ‘Trade’ section of the ‘Terminal’ window. Right-click on the order you would like to close and pick ‘Close Order.’
This opens an ‘Order’ window. Click the yellow ‘Close’ button in order to close your trade.
So if you have two positions or more open in MT4 and are wondering how to close one, this manual method is the way to do it, as you are specifying which individual trade you want to exit.
This manual method is not the only answer for how to exit a trade in MetaTrader 4 though. You can also close a trade in MT4 using a stop loss or limit order.
What is the difference between MT4 and MT5?
As stated above, MT4 and MT5 are both popular trading platforms used by traders in the financial markets.
While they share similarities, there are several key differences between the two platforms. What is the difference between MT4 and MT5? Let’s find out!
Let’s get started!
MT4 primarily focuses on the forex market, allowing traders to trade currencies, commodities, indices, and cryptocurrencies.
On the other hand, MT5 offers broader market coverage and provides access to additional financial markets, including stocks, futures, and options. This expansion in market coverage makes MT5 a more versatile platform for traders who wish to diversify their trading instruments.
One of the significant differences between MT4 and MT5 lies in their programming languages. MT4 uses MQL4 (MetaQuotes Language 4), while MT5 employs MQL5 (MetaQuotes Language 5).
MQL5 is considered more advanced and offers additional features and capabilities compared to MQL4.
This difference in programming languages means that indicators, expert advisors (EAs), and other custom tools developed for MT4 can’t be directly transferred to MT5 without modification.
Timeframes and charts
MT4 offers nine different timeframes for charts, ranging from one minute to one month. In contrast, MT5 provides 21 timeframes, offering more flexibility for traders to analyze price movements.
Furthermore, MT5 includes additional chart types, such as Renko, Range, and Point and Figure charts, which aren’t available in MT4.
Depth of market (DOM) and netting/hedging
MT5 introduces the Depth of Market (DOM) feature, which directly displays the order book and liquidity levels on the platform. This allows traders to see the market depth and execute trades with more transparency.
In terms of order types, MT4 follows the netting model, where positions of the same symbol are aggregated into one position. MT5, on the other hand, supports both netting and hedging modes. Hedging allows traders to have multiple positions, including long and short positions, on the same trading instrument simultaneously.
While both platforms offer a strategy tester for backtesting trading strategies, MT5 provides more advanced testing capabilities. MT4’s strategy tester is primarily designed for single-threaded optimization, whereas MT5 supports multi-threaded optimization.
This means that testing and optimization of trading strategies can be faster on MT5. Furthermore, MT5 allows for real-time testing, which enables traders to evaluate strategies in simulated market conditions using live data.
Economic calendar and built-in indicators
MT5 includes a built-in economic calendar, providing traders with essential economic news and events that can impact the financial markets. This feature is not available in MT4. Additionally, MT5 offers more built-in technical indicators compared to MT4, giving traders a broader range of tools for technical analysis.
Communication and community
MT5 offers improved communication and community features compared to MT4. Traders using MT5 can communicate with other traders through the built-in chat functionality. Furthermore, MT5 provides access to the MQL5.community, which is an online community where traders can share ideas, download additional indicators and EAs, and seek assistance from other members.
In summary, while MT4 and MT5 are both powerful trading platforms, MT5 offers enhanced features and broader market coverage compared to MT4. It provides access to additional financial markets, a more advanced programming language, more flexible charting options, and improved testing capabilities.
However, due to the popularity and widespread adoption of MT4, it continues to be a preferred choice for many traders, particularly in the forex market. Ultimately, the choice between MT4 and MT5 depends on the specific trading needs and preferences of individual traders.