Forex Trading Online // Why, When & How

On end of august, Alpari-UK changed its fixed spread policy to dynamic spread. Alpari UK was best known for their small spread of 1.8 pips on EUR/USD, which is also the most popular currency pair for scalp trading in night/asian session.

So, as Alpari-UK is one of my two brokers where I have live account, I was interested on how this change effects EAs designed for scalp trading at night. Especially how this influences two most popular forex trading robots Mega Droid EA and FAPturbo available for metatrader trading platform.

With simple MT4 script I was logging spreads from august 21 to end of august, and here finally I had time to do all the calculations.

I was also interested whether now with dynamic spreads Alpari UK is better regarding price re-quotes which ware quite frequent before.

Although I did spread logging for several currency pairs (all that MegaDroid Pro is using: EURUSD, EURCHF, EURGBP,GBPUSD and USDCHF) I just finished analyzing the most frequent pair EURUSD.

When I opened account with Alpari-UK it had only one fixed rate for each currency pair, but later on it changed its spreads to daily and night regime. But I guess that did not benefit them, as they still needed good spread on EURUSD to be competitive, and most of scalping was done at night when their actual cost and risk was higher… Before the change to dynamic spread AlpariUK had the following fixed spreads:

EURUSD  1.8 pips    1.8 pips
USDCHF  4 pips    4 pips
USDJPY  2.8 pips    2.8 pips
GBPUSD 3 pips    3 pips
AUDUSD  3 pips    5 pips
USDCAD  4 pips    4 pips
EURGBP  3 pips    5 pips
EURCHF  3 pips    5 pips
EURJPY  3.8 pips    3.8 pips
GBPJPY  7 pips    10 pips
GBPCHF  7 pips    10 pips
EURCAD  8 pips    12 pips
EURAUD  10 pips    14 pips
USDSGD  10 pips    12 pips
NZDUSD  7 pips    10 pips
CHFJPY  7 pips    9 pips
EURNZD  20 pips    20 pips
AUDJPY 7 pips    9 pips
AUDNZD  20 pips    20 pips
AUDCAD 10 pips    10 pips
AUDCHF  8 pips    10 pips
CADCHF  8 pips    8 pips
CADJPY  6 pips    6 pips
NZDJPY  10 pips    10 pips
USDDKK  40 pips    40 pips
USDNOK  75 pips    75 pips
USDSEK  100 pips    100 pips
USDHKD  7 pips    7 pips
SGDJPY 6 pips    6 pips

With change to dynamic spreads Alpari UK was promising even faster execution and more competitive spreads, especially on most popular currency pairs. For USD they are promising 16-23 pip spread…

My analysis for spread on EURUSD since the change to dynamic spread are the following:

All the hours are CET (currently GMT+2).

You can see that for scalpers trading at asian session now pays less than with older fixed spread at 1,8 pips. At other times (with exception of 10-11pm with spread 1,97)spreads are better

I also noted that around USA market open (15.30-16h CET) Alpari often experiences even tighter spread, but which only lasts few ticks – starting as low as 1.0,1.1,1.2pips…)… The biggest spread is as expected at start of Asian session – around 23-23.45h CET (you can read about forex trading hours here), when we measured maximum spread of 11 pips (rarely) but more commonly we saw it around 4-9 pips… Surprisingly this peak in spread sometimes also shows around 14.30 or 16h – maybe pointing to a hiccup while Alpari UK changes its feeds.

All in all we also noted less re-quotes, especially during the day trading. All in all I would say that Alpari UK’s change to dynamic spreads did a lot of good to day traders, and it did not hurt scalp traders so much – in worst situation you lose half a pip more than before, but you might be lucky and catch even occasional 1,6 pip spread in this session… This indicates that best forex trading times are during the day, especially when markets overlap.

So, for me, i will continue using Alpari UK for scalp trading with Megadroid and other scalping EAs in future (or at least until i do the analysis for other currency pairs – if anyone wishes to help contact me, i have the data in excel files)…

cheers!