Get To Know Meta Trader 4 to Avoid Going Broke

Why You Should Get To Know MT4 If You Want To Avoid Going Broke

To trade you need charts, you need to see the patterns that price is making, you need to add indicators and you need to open positions – duh – it wouldn’t be trading if you didn’t open positions. To do all this and more, you need a charting package or a trading platform. There are many such platforms out there but one takes first place by far: Meta Trader 4 (MT4). Of course some traders like other trading software more, but for my needs MT4 is the best; it’s also the most commonly used platform and the majority of Forex brokers offer it for free so you must get familiar with it if you want to trade. Next I will try to show you the basics of how to use MT4, an introductory guide… sort of.

 

Meta Trader 4 – Where It All Begins

Meta Trader 4 – and most charting software out there – has 2 basic functions. The first is showing you the chart of a certain currency pair and the second is trading that chart (opening and closing positions). In order to use it in a way that suits you, you will need to customize it. I figure I cannot explain all this without pictures so here is how your MT4 looks “out of the box” (the initial layout differs from broker to broker a bit but this is the main idea):

 

preview 1

 

The main parts of your new MT4 are:

  • chart window where you can see price action for your selected pair
  • indicator window, which – guess what – shows your indicators
  • Market watch, which shows you the available pairs (and live quotes) and allows you to open a new chart of a new currency pair
  • Navigator, which allows you to switch between accounts (if you have more than one of course) and to add indicators and Expert Advisors (EAs)

To modify your chart window you can right-click anywhere on the chart and then choose Properties or simply hit F8. A new window will open and you will be able to change the appearance of your chart in the Colors tab. If you want to add indicators in the lower window or on the main chart (some indicators go automatically to the main chart, others to the indicator window), you will need to open your Navigator, expand the Indicators column and double click on the desired indicator. Custom indicators can also be added but this will probably be the topic of a future article).

 

preview 2

 

Once you have your charts set up the way you like it, you need to know how to open a new order ticket: to do this you can click on the big “New Order” button or press F9. This is what you’ll get:

 

preview 3

 

The main components of the new ticket are:

  • Symbol: if your current chart is EUR/USD then the new order ticket will open automatically on that currency pair; however, you can change this in the “Symbol” tab.
  • Volume of your trade, in other words the position size or how much you want to invest (the volume is expressed in lots – 1 lot is usually 100,000 units).
  • Stop Loss and Take Profit levels. By adjusting these levels you decide how much you risk on the trade and how much you can make if you win (always use some form of Stop Loss).
  • Type. There are two types of orders: Instant Execution (order is executed at the next available market price) and Pending Orders (these include limits and stops – orders that will open at a future price, decided by you)
  • Buy or Sell buttons. I don’t know how to explain this except: click on Buy if you want to buy and click on Sell if you want to sell 😛

Once you open a new position (when you actually click on the Buy or Sell button), it will be shown in your terminal window:

The Terminal also shows you the balance, equity of the entire account and information about the current open trades such as time of opening, type, size, Stop Loss and Take Profit levels and current profit/loss. Account history is also available by clicking on the appropriate tab at the bottom of the Terminal.

 

 

Wrapping Things Up

This guide only covers the basics of Meta Trader 4 (probably an e-book is needed to explain everything about it) but it’s enough to get you started. You will discover some of its features on your own, others will be probably explained in future guides, but what you need to understand is that knowing your trading software well is a definite must for successful trading. If you don’t know how to open a new trade, how can you expect to make money, if you don’t know how to set your risk barriers, how can you expect not to go broke? If you are new to trading, get a demo account and play with your MT4, learn what the buttons do, read this article again and don’t be afraid to use the Comments section to ask questions about features that weren’t explained here.

 

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