How to Use the Spread Indicator (MT4 and MT5)?

What Is a Spread Indicator (MT4 and MT5)?

Spread Indicator (MT4 and MT5) is a tool that helps you to see the fees you need to pay the broker more easily. You can add this indicator to the trading platforms such as MetaTrader 4 and MetaTrader 5. After you can test it out to align with your trading strategy. This spread indicator can help you manage risk when the market becomes highly volatile through spread fluctuations.

How Does The Spread Indicator (MT4 and MT5) Work?

If you are in the Forex market, you might wonder whether you earned a full profit, what costs you need to know about, and how pips work. Well, all of these are connected to each other, so let’s see how the spread works in a simple way.

• When you trade on the exchange, you will see the buying price and selling price, which we call the "ask" and "bid" prices. In the ask and bid prices, there is a fee charged by the broker called the spread.

• For every order, you will pay the spread. Spread is measured in pips and depends on the trading asset, your trading account type, and market conditions.

• The spread indicator helps you save time by automatically calculating spreads and reducing confusion about pips, spreads, and related terms.

• Once you know the spread, you will know how much net profit you will earn from your trading after accounting for the spread.

How to Add a Spread Indicator in MT4 and MT5?

To see spreads more easily, you need to install an indicator on your trading platform first, then log in to your broker, and you can start trading. So how to add the Spread Indicator (MT4 and MT5)? Let’s see more details below.

1. You Need to Install MetaTrader 4 Or MetaTrader 5.

First step, you need to install the trading platform, either MetaTrader 4 or MetaTrader 5. The trading platform options depend on your trading skills. They have pros and cons that you can consider to suit your trading strategy the most. Once you finish installing the trading platform, you can log in with your broker to get started.

2. Add Spread Indicator to MT4 and MT5

You can install the spread indicator on the MQL5 website by searching for it. You will see many options available in MetaTrader 4 and MetaTrader 5. You can drag it into the price chart and run the indicator. Installing the spread indicator takes only a few minutes, and then it will be ready to use.

3. Set Up The Spread Indicator

Once the installation is complete, you can set up the spread indicator to suit your trading style. Also, some indicators allow you to block your trades when the spread gets too high for your balance, and you can set different spread limits for each asset you mark to trade so that you can manage your trading account.

Spread Indicator in MT4 and MT5 Trading Strategy

You can’t trade with a spread indicator, but you can use it to manage your trading costs effectively. Here’s how you can adapt the spread to your trading strategy.

Spread Indicator Buy Setup Strategy

When the spread indicator gives you a sign that it is low and stable, then this is the time to enter a trade. When you see that the market is in an uptrend, you always need a buying confirmation pattern to enter a trade. Don’t forget to set the stop loss and then take a profit when you see the bearish candlestick pattern.

Spread Indicator Sell Setup Strategy

As with a buying signal, you need to check the spread indicator to see if the market now has a low, stable spread. If the market is low and stable, and the trend is down, you need to find a candlestick pattern to confirm a downtrend. Once it is confirmed, you can enter a trade, set a stop loss, and set a profit target to exit the trade.

What Are The Differences Between The Spread Indicator in MT4 and MT5?

If you are hesitant or unsure which trading platforms to use to install the spread indicator. Here’s how the spread indicator works on different platforms, such as MetaTrader 4 and MetaTrader 5, below.

Metatrader 4

The MetaTrader 4 is a simple trading platform and great for beginners. You can install the spread indicator in MetaTrader 4, but it might not support advanced features. You will see the spread in pips on the spread chart and receive an alert, but it might have data limits and might not be able to track multiple assets.

Metatrader 5

The MetaTrader 5 is great for experienced traders because you can access more features of the spread indicator, such as viewing the spread across multiple time frames, checking the spread history, and more. This will help you get notified of more alert conditions that better suit your trading style.

Pros and Cons of Using Spread Indicator (MT4 and MT5)

Using spread indicators has advantages and disadvantages that you should consider. The spread indicator is not just a tool that displays the difference between the ask and bid prices. It also offers additional capabilities to help traders follow the steps below.

How to Use the Spread Indicator to Manage Your Trading Risk?

The spread indicator can also help you manage trading risk. You can see from how the spread indicator is displayed whether it’s now wider or narrower. Let’s see more of how you can also use it to manage your own risk!

• You should reduce the trading size when the spread gets wider.

• You can set stop loss and take profit following how the spread indicator is factored.

• You can combine your trading strategy with a spread to enter the trade when the spread indicator signals that it's low and stable.

Conclusion

Calculating spread can be confusing for beginners; that is why the Spread Indicator (MT4 and MT5) is a great option to install on your trading platforms.

You can use it to install MT4 spread indicator, which is great for beginners, or MT5 spread indicator, which is great for advanced traders who need more features.

The spread indicator is a great tool for scalpers and day traders to reduce trading costs. You can also customize the spread indicator to better suit your trading style and also the MT4 backtesting spread before using.