Scalping can be a very profitable trading style, but it puts heavy demands on you and your broker.
This page will explain what you need to look for in your search to find the kind of broker to help you be a successful scalper. We will also cover factors for success, scalping regulations, and present to you what we believe to be the best Forex brokers for scalpers.
IG
In Summary No withdrawal feeIG ranks among the best scalping Forex brokers due to its cutting-edge trading infrastructure. Forex traders get 100+ currency pairs, smart order routing, , and an average order execution of 13 milliseconds. Commission-free Forex trading fees start from spreads of 0.6 pips or $6.00 per 1.0 standard lot.
Algorithmic scalpers can rely on MT4, and IG also supports API trading for advanced algorithmic trading solutions. Trading statistics between June and August 2023 show that IG filled 98.99% of all orders with an order fill rate of 100% at the requested price or better.
Pros & Cons
- Broad asset selection for Forex traders
- Quality choice of trading platforms, including MT4
- Autochartist signals integrated with the proprietary web-based platform
- No minimum deposit + free deposits and withdrawals
- Limited deposit and withdrawal methods
FXTM
In Summary Best all-around broker with high floating leverage and fast executionFXTM remains at the top of any list dedicated to the best Forex broker for scalping, and the maximum leverage of 1:2000 is one of the most defining tools for scalpers. There are no restrictions on trading strategies, and over 2,000,000 traders manage their accounts at FTXM, which established itself as a market leader for emerging markets and enjoys a growing presence in frontier markets. The 30% deposit bonus, available to most non-EU clients, provides an boost to new retail traders. FTXM is also one of the most transparent and trustworthy online brokers in operation.
Pros & Cons
- Excellent commission-based Forex pricing environment and transparency
- Upgraded MT4/MT5 trading platforms plus proprietary mobile trading app
- Quality market research and educational content for beginner traders
- A highly regulated broker with a tier-1 license
- Limited choice of commodities
Pepperstone
In Summary Great ECN execution on MT4/5, cTader, TradingView and Pepperstone proprietary platformPepperstone features VPS hosting for 24/5 low-latency Forex trading and has deep liquidity pools that keep spreads tight. Commission-based trading fees feature raw spreads from 0.0 pips for a commission of $7.00 per 1.0 standard round lot. Scalpers can use MT4/MT5 and cTrader, as all three of them support algorithmic trading. It places Pepperstone high on my best scalping Forex brokers listing.
APIs allow scalpers to connect advanced algorithmic trading solutions to the Pepperstone infrastructure. Beginner scalpers will benefit from Capitalise AI, enabling algorithmic trading in a code-free environment and lowering the entry bar for algorithmic scalping, a rare competitive edge.
Pros & Cons
- Excellent choice of trading platforms consisting of MT4/MT5, cTrader, TreadingView and Pepperstone Platform
- Market-leading MT4/MT5 upgrade package, Autochartist, and API trading
- Social trading support via Signal Start, MetaTrader Signals, Copy Trading by Pepperstone, DupliTrade
- Leverage of up to 1:400 depends on jurisdiction and superb trade execution
- Demo accounts have 60-day time limits
AvaTrade
In Summary Highly regulated, choice of fixed or floating spreadsIrish-based AvaTrade provides scalpers with a choice of fixed and floating spreads from a commission-free trading account. While this broker does not grant ideal conditions for Forex scalpers, it remains one to consider amid its deep liquidity. The minimum mark-up is 0.9 pips, above the range most successful scalpers prefer, and less competitive than most well-established brokers. This market maker does not note any restrictions on trading strategies and maintains technology infrastructure to handle high-volume and high-frequency trading strategies. The cost structure does discourage scalping to a certain extent. Some scalpers may take advantage of fixed spreads during market-moving events to avoid slippage.
Pros & Cons
- High quality educational offering via AvaAcademy
- Excellent choice of trading platforms catering to various trading needs
- Broad asset selection and cross-asset diversification opportunities
- Well-regulated and trusted broker with oversight from a central bank
- Trading costs competitive but nothing special
FP Markets
In Summary ECN trading with leverage up to 1:500FP Markets has been serving traders since 2005 and grew into one of the most recognized Australian-based multi-asset brokers. It operates under the oversight of the Australian Securities and Investments Commission (ASIC) and the Cyprus Securities and Exchange Commission (CySEC). Most global clients will trade with the unregulated international business company (IBC) registered with St. Vincent and the Grenadines Financial Services Authority (FSA). FP Markets has no restrictions on any Forex scalping strategy. The no dealing desk (NDD) execution model and execution speed below 40 milliseconds offer the technology that infrastructure scalpers require to succeed. The 36 industry awards confirm the excellence of this broker.
Pros & Cons
- Choice of trading platforms and auxiliary trading tools
- Very competitive cost structure and excellent asset selection
- Low minimum deposit requirement and leverage of up to 1:500
- Well-regulated and trustworthy
- Availability of Iress geographically restricted
Top Scalping Forex Brokers
- IG, No withdrawal fee.
- FXTM, Best all-around broker with high floating leverage and fast execution.
- Pepperstone, Great ECN execution on MT4/5, cTader, TradingView and Pepperstone proprietary platform.
- AvaTrade, Highly regulated, choice of fixed or floating spreads.
- FP Markets, ECN trading with leverage up to 1:500.
Best Scalping Brokers Comparison
| | | | ||
Regulators | ASIC, BaFin, CySEC, DFSA, FCA, FINMA, FMA, FSCA, JFSA, MAS | CMA, FCA, FSC Mauritius, FSCA | ASIC, BaFin, CMA, CySEC, DFSA, FCA, SCB | ASIC, BVI, Central Bank of Ireland, FFAJ, FSCA, KNF, MiFID | ASIC, CMA, CySEC, FSCA |
Year Established | 1974 | 2011 | 2010 | 2006 | 2005 |
Execution Type(s) | Market Maker | ECN/STP, Market Maker | No Dealing Desk, NDD | Market Maker | ECN/STP |
Minimum Deposit | |||||
Average Trading Cost EUR/USD | 0.9 pips | 0.1 pips | 1.1 pips | 0.9 pips | 1.2 pips |
Average Trading Cost GBP/USD | 1.4 pip | 0.2 pips | 1.4 pips | 1.5 pips | 1.4 pips |
Average Trading Cost Gold | $0.30 | $0.18 | $0.15 | $0.29 | $0.16 |
Trading Platform(s) | Other, MetaTrader 4, Proprietary platform, Trading View+ | MetaTrader 4, MetaTrader 5, Proprietary platform | Other, MetaTrader 4, MetaTrader 5, cTrader, Proprietary platform, Trading View+ | Other, MetaTrader 4, MetaTrader 5, Proprietary platform, Web-based+ | MetaTrader 4, MetaTrader 5, cTrader, Proprietary platform, Web-based |
Islamic Account | |||||
Negative Balance Protection | N/A | N/A | |||
Get Started Visit Website71% of retail spread bet and CFD accounts lose money | Visit Website | Get Started Visit Website75-95% of traders on margin lose | Visit Website | Visit Website |
What is Scalping and Who is it for?
Scalpers look to exploit large trading volumes and minor but predictable price movements. While the basic principle of scalping remains simple, implementing it takes a lot of work. Scalping remains the shortest form of short-term trading, and those who utilise it successfully can reap its benefits very often because of the large number of potential scalp trades, which is why it is so attractive to many traders.
Successful scalping requires strong discipline and psychology. High levels of leverage are often used. Although many beginner traders are attracted to scalping as a trading style, it is the hardest trading style for a new trader to learn successfully. Scalping is most suitable for very experienced or even expert traders.
How to Choose a Scalping Broker
- Execution speed – very fast execution is essential for successful scalping, so ask a broker about their average trade execution speed.
- Spreads & commissions – must be very competitive to make scalping economical. A scalper might only be looking for a five-pip profit on a trade; a two-pip spread there is much worse than a one-pip spread.
- Leverage regulation – if you need high leverage to scalp, ensure your broker is legally allowed to provide it to you. Regulators in Europe and the USA must cap the maximum leverage offered to their clients.
- Trading platforms – as scalping is so fast, it is important that you are very comfortable using your trading platform to execute trades quickly. Although no platform will give you an edge, you must like using it.
- Liquidity providers – your broker needs to have access to a lot of liquidity (supply of what you trade) so you can be sure that wide spreads and slippage are less likely when you scalp. If your broker doesn’t publish the names of their liquidity providers, ask them.
Broker Policy Towards Scalping
Each broker maintains terms and conditions where traders can locate the policy towards scalping. Given the popularity of Forex scalping, many brokers answer the question directly in their FAQ section. Always make sure to scalp with a broker that allows it, and while many place no restrictions on it to attract more traders, the cost structure discourages it. Others may restrict the number of permitted trades per day, open positions, or total lot size, which can negatively impact scalpers.
Key Factors for Successful Scalping
- Strong mastery of trading psychology.
- Solid ability with technical analysis.
- Skill in identifying precise trade entry points.
- Talent in determining optimal trade exit points.
- Good feel for support and resistance levels/areas.
- Broker allowing scalping, providing fast trade execution.
- Focus on trading highly liquid instruments such as EUR/USD, USD/JPY, S&P 500 futures, etc.
- A broker allowing their use is needed if using automated trading tools such as MT4/MT5 EAs (expert advisors).
Scalping Regulations
Most global regulators leave the applicable rules up to brokers, but the US Securities and Exchange Commission (SEC) prevents traders with less than $25,000 in capital from executing a scalping strategy. It falls in the pattern day trading category, and those violating it will have their account suspended until the equity threshold is raised to satisfy the requirement. The $25,000 rule applies to US equity markets only. Futures and Forex traders do not face it, leaving it up to individual brokers to set rules and regulations.
Scalping with Tight Spreads
Tight spreads are one requirement for scalping Forex. The smaller the markup, the greater the profit. It also requires less of a price action move to turn a profit. Since trading costs remain the primary cost for scalpers, the more calculated they are, the better a Forex scalping strategy can perform. The most favoured structure is a competitive commission with raw spreads, which many brokers provide together with a volume-based rebate program, combining for an ideal setup for scalpers to thrive.
Scalping Execution
It is important to know that some Forex brokers do not allow scalping, so if you are going to scalp, choose a broker that does allow it.
Successful scalping requires fast execution and (usually) tight spreads for success. Using a broker offering ECN, STP, or DMA execution is essential for good scalping. They tend to provide fast execution with tight spreads during periods of high liquidity, which is the best time to scalp.
Usually, ECN brokers permit Forex scalping as they are not the counterparty to client positions and charge a commission per transaction. Their technology infrastructure also remains superior, resulting in competitive trade execution and price improvements.
Funding & Withdrawal Methods of Scalping Brokers
Since scalpers generate profits and losses daily, they often conduct more financial transactions to withdraw and protect their capital. It can result in an increase in costs, which will lower the overall profitability. Most brokers do not charge for deposits, but withdrawal fees can apply, depending on the preferred payment processor. External costs, dependent on the same, can also exist. Therefore, scalpers must consider scalping brokers' funding and withdrawal options to ensure a cost-effective structure exists. Online payment processors often provide a significant advantage, and some brokers grant low-cost debit cards as an alternative, restricted by geographic location.
Scalping Brokers' Customer Support
While most traders do not require customer support, the high-frequency nature of scalpers may result in more assistance. Trading with a broker that offers easy access to a representative and features swift response times via live chat or phone is beneficial. Since most scalpers close all positions at the end of the official trading day, 24/5 or 25/7 assistance is not a requirement.
My Take
We have shown how tight spreads, speed and reliability of execution, the precise definition of scalping, choice of Forex pairs to trade, and the use of leverage and its maximum will greatly impact determining your performance as a scalper.
Which factors you prioritise will depend on your own scalping style. Remember, you must ensure your deposit is safe with any broker. If a broker isn't reliable and well-regulated, it is not one of the best Forex brokers, so why trade with it?
It is a good idea to open a demo account with your broker of choice but remember; live accounts do not usually reflect demo account conditions.
