Forex scalping is a rapid trading style that involves entering trades and exiting within a few minutes (sometimes seconds) while focusing on small profits. It has gradually evolved into one of the most popular day trading techniques where traders seek to make the most out of negligible price movements. How much a trader makes here, depends on a host of factors like order execution speed, spreads, and other fees charged by the forex broker.
Not all brokers allow scalping on their platform, and some that do have their systems working against you. Some will, for instance, place a restriction on the number of trades you can execute in a day, others have lagging systems that put you at a disadvantage while others don’t have enough technical analysis tools for price action monitoring and analyses. You owe it to yourself to first conduct sufficient due diligence on Forex brokers, checking their terms and conditions, and vetting the performance of their systems to ensure they don’t lose you money.
We have done the legwork and identified seven of the best forex brokers with the lowest spreads for scalpers.
How did we come up with this list?
When trying out the different no-dealing desk (NDD) forex brokers that allow scalping and testing out their systems, we focused primarily on how their operations and features affect the profitability of a scalper. Our attention was particularly drawn to anything else that has the same impact on the trade as spreads and fast processing speed. Other factors we put into consideration include:
- Advanced technical analysis tools
- Incidence and extent of slippage and re-quotes
- Fees and commissions
- Trade limits (number of daily trades and time limit for scalped trades)
- Availability of ECN accounts
- High leverage brokers with low minimum deposit
- Regulation and broker’s scalping policies
- Expert adviser support
Best forex brokers for scalping with low spreads
1. Pepperstone
Australia’s Pepperstone forex and their Razor account top our list of brokers that support scalping with lowest spreads. With ECN account, spreads for the EURUSD account start from 0 pips with a fixed commission of AUD 3.5 for every lot traded (100,000 units of currency). Scalpers at this level also have access to high leverage, to a maximum of 1:500 and no restrictions on the use of expert advisors. Plus it only requires a minimum deposit of $200.
Apart from the ultra-tight spreads and low commissions, Pepperstone also has some of the highest order execution speeds on their MT4, MT5, and cTrader platforms that host these platforms. It also features prominently on the list of brokers with the highest number of technical analysis indicators integrated into their platform. The MT4 platform, for instance, has over 85 professional indicators pre-installed while its MT5 counterpart has 38. Their user-friendly platforms also allow for the adjustment of different timeframes.
Pros and cons
Pros
✅Supports automated trading
✅ASIC and FCA regulated
✅Supports hedging
✅Supports web, mobile, and desktop trading
Cons
❌High withdrawal fees
❌Doesn’t provide trading platform tutorials
2. London Group Capital (LCG)
We also found LCG’s ECN trader account features and policy terms friendly to forex scalping. Spreads start from 0 pips for the major currency pairs and a commission of between $10 and $30 per month. Professional scalpers operating the LCG ECN account will have access to a leverage 1:200 and high-speed order executions from the MT4 platform. The account, however, requires a significant minimum deposit of $10,000.
LCG stands out from the crowd with its guaranteed stop loss order feature, that is currently capped at 3 pips for all major currencies. It also has a friendly minimum trade size at 0.01 lot and even friendlier market access as it is available on the smartphone app, web trader, and as a desktop app. The broker’s system supports automated trading and is also equipped with several professional technical indicators for price action monitoring, as well as, an economic events calendar.
Pros and cons
Pros
✅Superior technologies for high-speed order execution
✅FCA regulated
✅Solid reputation
✅Allows trade hedging
Cons
❌Punitive minimum balance
❌Doesn’t offer VPS service
3. IC Markets
We also liked the features and operations of the True ECN trading account by IC Markets. True ECN boasts of tight spreads kept as close to zero as possible and an even lower commission of $3 per lot with no re-quotes, hidden additional costs, or trade restrictions. According to the forex broker, their platform has the backing of over 50 tier-1 banks across the world providing liquidity for its trades ensuring that close to USD 15 Billion are traded on its platform daily.
Our team was particularly intrigued by the ultra-fast execution of orders on either of the IC Markets platforms, even on the free VPS service provided by the broker. The trader allows for automatic trading while advancing leverage of up to 1:500 to both the manual and automated traders. The minimum deposit for the ECN account is $200 and it can be used to trade over 60 currency pairs. Plus it is available on such diverse platforms as MT4, MT5, and cTrader that can be accessed on the move through mobile trading.
Pros and cons
Pros
✅User-friendly and customizable charts and layouts
✅Fast account opening
✅Dedicated customer support
Cons
❌No drawdown and negative balance protection
❌No investor protection
4. ThinkMarkets
Spreads at ThinkMarkets start at 0 pips with a commission of $3.5 for every lot (100,000 units of currency) traded with their ThinkZero account. Here, clients have access to high leverage, up to 1:500, regardless of whether they trade manually or with the assistance of an expert advisor. The forex broker, however, places a maximum trade limit at 100 lots per day. And the account will only support trades executed on the MT4 platform.
One of the most unique things about ThinkMarkets is their account manager feature that connects traders to expert traders who walk them through the aspects of trade and trading account management. We also liked their emphasis on technology that not only posts impressive order execution speeds but makes it possible to access the broker services from multiple devices. ThinkMarekts revolutionary and industry first trade interceptor and trend-risk scanner give them an extra edge over the competition.
Pros and cons
Pros
✅Revolutionary technologies make it friendly to both novice and expert traders
✅Superior customer support from account managers
✅FCA and ASIC regulated
✅Fast deposit and withdrawal processing
Cons
❌A limited number of currency pairs to trade
❌Inferiors risk management practices
5. FP Markets
FP Markets ECN Raw account also has some of the friendliest trading terms any scalper can ask for. These include spreads of 0 pips and a low commission of $3.5 per lot traded (100,000 units each). We liked the versatility offered by the broker where their accounts support both mobile trading and VPS services, in addition to the fact that its available in all the major trading platforms like MT4, MT5, and cTrader. More importantly, the ECN Raw account supports automated trading and gives the trader’s maximum leverage of up to 1:500.
Opening the ECN Raw (the account that supports scalping) with the ASIC regulated broker, requires a minimum $1,000 deposit. Clients are also assured of a safe trading environment with no re-quotes and equipped with professional technical analysis tools, as well as, proper risk management practices like drawdown and negative balance protection. Both novice and experienced traders also benefit from the services of account managers who guide their trades on navigation within the broker’s platforms.
Pros and cons
Pros
✅Solid reputation and AISC regulated
✅Fast order execution speeds
✅Supports EAs
✅Prompt customer support
Cons
❌High withdrawal fees
❌Accepts limited payment processing service providers
6. Titan FX
The Titan Zero-Blade ECN account by Titan FX presents yet another viable option for scalpers. The account’s tight spreads for all the major currencies are further complemented by a low commission ($3.5 )per lot traded. Titan FX claims to work in conjunction with over 50 banks and an equally large number of Dark Pool finance providers to guarantee the highest liquidity for its traders. Interacting with the broker and their platform, one can’t help but notice the emphasis they have accorded technology and this explains the broker’s ultra-fast order execution speeds.
Titan FX presents traders with a choice of over 70 currency pairs to choose from. These can be traded manually or with the assistance of automated expert advisers and relatively high leverage, of up to 1:500, regardless of the volume of trade. Some additional features we liked about Titan FX include their risk management policies that allow for hedging and protects against negative balance, as well as, its support for a wide range of cash transfer options for both deposits and withdrawals.
Pros and cons
Pros
✅Free deposits
✅Unrestricted trades (from micro 0.01 lot)
✅Accessible on multiple devices that support MT4 platform (web, mobile, PC traders)
✅Strong emphasis on technical analytics
Cons
❌Doesn’t offer bonuses
❌Limited to a handful of countries
❌Beginner traders may consider the $200 minimum deposit high
7. XM Group
Spreads for all major currencies at XM group’s ultra-low account, best for scalping, start at 0.6 pips and zero-commission. Leverage, on the other hand, is capped at 1:888 for trades below $20,000, those in the $20,000-$100,000 range receive 1:200 whereas anything above this gets 1:100. The broker demands a minimum deposit of $50 for the scalpers and restricts the trading at 50 lots (100,000 units each) per client that can be traded on such trading platforms as MT4, MT5 and XM Web Trader.
XM Group stands out from the crowd due to their emphasis on proper risk management where they implement solid stop loss order features that protect against negative balances. Additionally, the broker has one of the largest collections of forex trading pairs that their clients can choose from. More importantly, the broker sends free and actionable technical analyses reports that traders can use to inform their decision to enter or liquidate trades.
Pros and cons
Pros
✅Dedicated account managers and customer support team
✅Wide range of technical analyses tools
✅Emphasis on market research and economic news
✅User-friendly and customizable charts and layouts
Cons
❌Complicated and sluggish live chat option
❌Discriminative use of leverage
Bottom line
The volatile nature of the forex market and the fact that it is dominated by institutional investors like banks and other brokers stacks numerous odds against an individual trader. Rising above this and earning a tangible return on investment, especially if you decide to ride on scalping technique means pooling together everything that gives your trades an advantage while cutting down on anything else that eats into your profits.
It all starts with finding forex brokers that guarantee lowest spreads, commissions, and such other fees as deposit and withdrawal charges. When it comes to profit maximization, however, it is not enough to have low fees. These have to be accompanied by the fulfillment of every other factor that guarantees profit maximization like the integration of technical analysis tools, proper risk management, user-friendly interfaces, and timely customer support.
Let these factors inform your choice of the best fore broker with the lowest spreads. We have scoured the internet and the forex industry and after testing numerous brokers, we arrived at this list. Each of these brokers was carefully handpicked based on the fact that they either fulfill all the conditions or have other factors that make them uniquely adapted for scalping.
FAQs
The primary difference between ECN and standard accounts lies in their modes of operation, commissions, and approach to the market. In an ideal situation, the ECN account will have lower spreads compared to its standard counterpart. Additionally, while most forex brokers will act as intermediaries between standard accounts and the market, ECN account holders have direct access to the market. In most cases, ECN accounts will require a higher minimum deposit compared to the rest of the accounts.
Maintaining ECN servers and accounts requires key technological adjustments on the part of the broker to guarantee the speedy execution of orders. Forex brokers have lesser control of the ECN accounts compared to the rest of the accounts. Most have therefore shied away from ECN accounts or put up punitive restrictions to its use like high commissions, huge deposits, and limits to the number of trades one can execute per day.
Most forex brokers that offer scalping services will often post their information on their website. The fact that a broker supports ECN accounts is an indication that they support scalping. You should, however, be cautious when interacting with any dealing desk broker who purports to support scalping as the service is only viable to non-desk dealing brokers. The safest and surest way of telling whether a broker supports scalping, especially when they don’t explicitly affirm this on their website, is by contacting them.
The forex industry operatives hail the ECN brokerage services for the level of anonymity it provides its clients. Trading here allows for complete anonymity and price neutrality where market participants don’t judge one another based on the trading tactics or trading strategies used. More importantly, it is not subjected to the often high fixed spreads that brokers impose on other trading accounts as they deal directly with the market.
Downsides of scalping with an ECN account include being subjected to punitive commissions by the forex brokerage houses. Additionally, most forex brokers demand that you prove your ability to tolerate risk when scalping with the highly volatile ECN account by way of high minimum deposits and operating balances. What is the difference between ECN and standard accounts?
Are ECN accounts available with all brokers?
How can I tell if my broker allows scalping?
What are the advantages of working with an ECN broker?
What is the downside of scalping with an ECN account?
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