Jasmine Birtles
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Why May’s FX Volume Crash Could Alter Strategy for Retail Forex Trading Brokers
Moneymagpie Team
17th Jun 2025
What happens when institutional FX trading cools off so suddenly? In May 2025, major platforms saw a sharp and unexpected drop in volume. The reasons weren’t dramatic; no crisis and no flash crashes, just a widespread pause in activity. But that silence spoke volumes.
While the year-on-year growth trend stayed positive, the month itself marked one of the steepest slowdowns in recent memory. For any forex trading broker catering to retail clients, it’s a moment worth dissecting.
- A Quick Look at the Numbers
- What Triggered the Slowdown?
- What This Means for Retail-Focused Brokers
- Strategic Adjustments Brokers Should Consider
- The Regional Breakdown Matters
- Could This Be a Turning Point?
- When the Market Goes Quiet, Make Noise
A Quick Look at the Numbers
May’s pullback was not isolated to one region or platform. It was broad and visible across all major FX venues. Let’s break it down.
| Platform | Total Volume (May) | % Drop from April | ADV (May) |
| FXSpotStream | N/A (ADV only) | ADV down 19% | $99B (total), $68B (spot) |
| Cboe | $1.06T | Multi-month low | $48B |
| Euronext | $719.8B | -19% | $32.7B |
| 360T (Fastmatch) | $605.1B | -30% | $27.5B |
| TFX (Japan) | 1.43M contracts | -37% | 65,000/day |
The decline in volume wasn’t driven by fewer trading days. It was driven by a lack of market momentum. Without strong catalysts or volatility, even the largest FX players stayed cautious.
What Triggered the Slowdown?
Unlike sharp market drops caused by geopolitical events or economic shocks, this one was rooted in stability. That sounds counterintuitive, but here’s why it matters.
- Low volatility – Major currencies barely moved. In May, the US dollar declined just 0.2% compared to a 4.4% drop the month before. Without price swings, traders tend to wait.
- No policy surprises – Central banks like the Federal Reserve and Bank of Japan stuck to predictable messaging. This kept investors in holding mode.
- No major data releases – With limited economic reports or global developments, there wasn’t much to trade on.
- April’s overhang – April’s volatility surge (driven by trade rhetoric) had pulled forward a lot of activity. In May, the market was still in cooldown mode.
The result? Fewer trades, fewer participants, and softer numbers almost everywhere.
What This Means for Retail-Focused Brokers
Institutional volume doesn’t just affect the big banks. It plays a central role in shaping the conditions that any trading broker relies on when serving retail clients. Brokers targeting individual traders often use institutional liquidity to build pricing models, manage risk, and handle order execution. When that liquidity thins out, retail trading can become more expensive or less efficient.
Three key areas likely to feel the effect:
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Spreads and execution quality
With thinner books, spreads may widen, and execution speed can suffer, especially on minor currency pairs.
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Reduced trader engagement
Fewer market movements mean fewer signals, and some traders may simply wait out the lull.
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Increased risk exposure
Quiet markets can lull traders into complacency, increasing the risk of overleveraged positions when volatility returns.
Strategic Adjustments Brokers Should Consider
During a volume drought, brokers need to stay agile. Rather than waiting for the market to pick up again, it makes sense to reassess positioning and offer more value through services, support, and structure.
Here’s what that might look like:
- Strengthen market commentary – Offer clients more guidance, including analysis and trading ideas tailored to quieter markets.
- Boost education – Run webinars or build resources around risk management, patience, and identifying breakout opportunities.
- Optimise pricing strategy – Consider tiered spreads or promotional pricing around key trading hours to maintain volume.
- Focus on retention – Keep traders engaged through loyalty programmes, community features, or personalised insights.
- Diversify instruments – Introduce other tradable assets that might offer more movement, such as commodities or indices.
- Prepare for volatility’s return – Use this window to ensure systems, support staff, and infrastructure are ready for high-activity phases.
While market activity will eventually return, these adjustments can keep a broker visible and useful even when things go quiet.
The Regional Breakdown Matters
Not all markets were hit equally. The Tokyo Financial Exchange saw the sharpest declines, with volume on USD/JPY falling significantly. This should serve as a signal to brokers operating in Asia or with clients trading yen-heavy pairs.
In Europe, the fall was less extreme but still significant. Platforms like Euronext and Fastmatch’s 360T saw declines between 20 and 30 per cent. This matters for brokers relying on euro-cross volatility or targeting European clients.
Each region may need a tailored approach. In some areas, traders might be more sensitive to costs. In others, education or platform usability might carry more weight. A one-size-fits-all plan won’t cut it here.
Could This Be a Turning Point?
It’s entirely possible that May will prove to be a short-term dip: a pause before a fresh wave of activity. But even if trading volumes pick up in June or July, the message is clear: market conditions can shift quickly, and brokers need to be built for that.
The most vulnerable brokers will be the ones waiting for volume to solve their problems. The most successful ones will be actively creating value regardless of market noise.
This period could act as a stress test. It shows which brokers have strong infrastructure, smart retention plans, and the ability to adapt, and which don’t.
When the Market Goes Quiet, Make Noise
In forex, silence isn’t always golden. It can create uncertainty, boredom, or hesitation, especially among retail traders who rely on movement and momentum. For brokers, this is where leadership shows up.
The best approach right now? Actively engage. Help traders stay informed, interested, and ready for what’s next. Make sure your offering holds up, even in the quieter times. Because eventually, the volume will come back.
Disclaimer: MoneyMagpie is not a licensed financial advisor and therefore information found here including opinions, commentary, suggestions or strategies are for informational, entertainment or educational purposes only. This should not be considered as financial advice. Anyone thinking of investing should conduct their own due diligence.
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