Cloud computing: How this trading tech will boost the future of forex trading

As the world's largest financial market, the foreign exchange sees a daily average trading volume of $5 trillion, with price movements affected by factors such as different countries' economic growth, international trade relationships and changes in interest rates.

Cloud computing can make it easier, more secure and more efficient for foreign exchange investors, especially during the current circumstances, where we have seen significant increase in remote trading.

A recent report by a financial technology company revealed that by the year 2025, all foreign exchange (forex) trading is expected to be conducted via the cloud. This is a seemingly plausible feat, as the very nature of the forex market is easily adaptable to a cloud-based system. In this article we will explain how cloud computing is expected to effect forex trading, and the benefits of this technological venture.

How has cloud computing impacted forex trading?

Forex trading is already primarily based in technology, but the recent pandemic has further increased the demand and reliance on cloud computing. Not only has it enabled financial businesses and individual investors to continue to trade remotely, but it has also allowed for data management to be more cost-effective and efficient – worthy traits when there are constant requirements to access data quickly in response to factors that affect the price movements in the forex market.

Due to the circumstances caused by the worldwide coronavirus crisis, investors have been forced to diverge their trading strategies and the way they access the data needed to trade in the forex market. Therefore, cloud computing has already began to become an incorporated part of forex trading techniques, and this is only set to soar over the coming years.

According to the aforementioned survey on this topic, the research showed that the development and upgrades involving cloud computing are at the top of the agenda for financial intuitions and forex brokers alike. The continuing increase in cloud software usage can be attributed to the following factors:

-    The low cost of the technology

-    The ease in which cloud computing can be incorporated with forex trading

-    The efficiency in which both brokers and investors can access data

With these elements in mind, it's clear to see that the usage of cloud technology has become more attractive to the financial industry, as it will improve trading decisions and essentially the ability to profit from trading in the market.

After all, as a forex investor or a broker, there is a constant need to consume relevant data in order to make well-informed decisions and take a position on the market accordingly. The availability of cloud technology makes this process easier and quicker.

It is expected that the industry is to see a rise to 41% in forex trading businesses using cloud computing in the coming years, compared to the 24% of companies using this type of software currently.

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What are the advantages of cloud computing?

There are several benefits of cloud computing when it comes to forex trading, hence its surge in popularity recently, as well as its expected continuing upward trajectory. The main advantage is the low operational costs of outsourced cloud technology, whereas it can be a lengthy and expensive undertaking to construct similar software in-house. Using external cloud software also reduces any potential risks or issues that could arise.

The volatile nature of the forex market means a quick response to price movement is required, which as mentioned before, is made easier through cloud computing, with all the necessary people involved having access to the data. This technology also helps to speed up the process and direct access to the market, as well as improve accessibility of analytical tools.

The efficiency of cloud computing means that well-informed trading decisions can be made in a shorter timeframe, allowing forex investors to focus on other elements, such as managing their trading risks or position in the market, which theoretically can improve the gains through trading.

As proven by the aftermath of the pandemic, remote trading is made easier with cloud computing, and with flexible working seemingly here to stay, cloud computing usage is also expected to rise because of this.