MT4 vs MT5: Which Should You Choose for Crypto Trading?

What Is MetaTrader 4?

MetaTrader 4, commonly referred to as MT4, is a trading platform developed by MetaQuotes in 2005. While it is popularly used for forex trading, MT4 trading supports other instruments, like cryptocurrencies, indices, and commodities, via Contracts for Difference (CFDs). The platform’s notable features include its easy-to-use interface and the option to design trading robots or automated trading strategies. Traders appreciate its customization options, which enable them to personalize the platform according to their trading preferences.

What Is MetaTrader 5?

MetaTrader 5 was introduced in 2010, five years after the release of MT4, to improve upon its predecessor’s achievements. It stands out as a versatile trading platform, supporting more financial instruments, including forex, bonds, futures, stocks, indices, and commodities. In contrast to MT4, MT5 boasts improvements in speed and efficiency while providing expanded trading functionalities. While it does not replace MT4 entirely, MT5 grants traders access to more tools crucial for success.

How MT5 Compares to MT4 for Crypto Trading

These are some of the distinguishing features between the two trading platforms.

Performance

MT5, introduced after MT4, has a performance boost and operates much quicker. It also has improved server capabilities, enabling brokers to connect to four specialized servers, unlike MT4, which relies on a single server.

Market Selection

Unlike the MT4 limit of 1024 symbols for tradable financial instruments, MT5 does not have such restrictions and supports an unlimited number of symbols. This flexibility allows traders to explore more markets and make the most of hedging strategies on the platform.

Time Frames

MT5 offers an additional 12 time frames compared to the standard nine timeframes available in MT4. These include seven variations of hourly charts and 11 variations of minute charts.

Algorithmic trading

One notable feature of both MetaTrader 4 and MetaTrader 5 is their innovative approach to algorithmic or automated trading. This functionality enables traders to create and utilize Expert Advisors (trading robots).

An Expert Advisor (EA) is a software tool for analyzing prices and executing trade orders based on specific technical signals. The benefit of using EAs lies in their ability to eliminate emotional biases that could negatively impact trading decisions. Most trading strategies can be implemented through the use of trading robots (EAs).

The critical difference between the two platforms lies in the programming languages they employ. While MT4 utilizes MQL4 (MetaQuotes Language 4), MT5 utilizes MQL5 (MetaQuotes Language 5). MQL4 and MQL5 serve as integral programming languages for creating trading robots and technical indicators on the platforms. With MQL5, traders can create or modify scripts and access an embedded MQL5 community chat feature. It is important to note that systems developed in MQL4 are not compatible with MQL5 platforms.

Execution Types

MetaTrader 4 includes three types of trade execution: instant execution, market execution, and request execution. On the other hand, MT5 offers all three of these types plus an additional one called exchange execution. The exchange execution mode allows trade operations to be sent to an external trading system and executed at the prevailing market price.

Order Fill Policies

When using MT4, traders only have access to the instant execution of the Fill or Kill feature, where orders must meet the volume to be executed. There are no exceptions here!

However, things work differently on MT5. If the requested volume is not available, other offers in the market can fill it. Traders have the flexibility to adjust their orders to be partially filled on MetaTrader 5.  When a trade matches the specified limit order at its volume, it goes through, while any remaining unfilled volume gets canceled. There are options for setting specific order execution conditions.

• Immediate or Cancel: If an order cannot be filled completely, the available portion will be executed immediately, and the unfilled part will be canceled.
• Return: This policy, applicable to limit, stop-limit, and market orders, allows the unfilled portion of a partially filled order to remain active and continue to be processed.

Strategy Testing

Traders can use both the MT5 and MT4 platforms to securely test their strategies on historical price charts. This helps them spot any issues and determine the optimal times for execution. MT5 offers improved backtesting features compared to MT4, with its multithreaded strategy tester being more advanced than the single-threaded version in MT4.

Order Types

In MT4, you can place only four order types: buy stop, sell stop, buy limit, and sell limit. On the other hand, MT5 offers all four types along with two additional ones: buy stop limit and sell stop limit.

Graphical Objects

MT4 and MT5 both offer analysis tools for recognizing market cycles, support and resistance levels, creating channels, and spotting trends in financial instrument prices. In comparison to MT4’s 33 graphical objects, MT5 provides an additional 18 tools totaling 44. Some of these tools include Wave Construction and Buy-and-Sell indicators.

Choosing the Best Platform for Crypto Trading

MT4 is well known for its user-friendliness and better suitability for those new to crypto trading. MT5 has a more robust set of technical indicators, timeframes, and graphical tools for analysis. Both packages excel at being easy to use, but MT5’s advanced capabilities may come with complexities that might seem challenging for beginners.

Although it is easier to use, MT4 has fewer features than MT5. While MetaTrader 5 is technically a better platform, MetaTrader 4 is still more popular. However, the adoption of MT5 continues growing with each passing year.