@Matt Wolf has some good information.
In regards to your comment of 'trading against other clients'; to avoid this you will want to participate in a "true ECN". Believe it or not, that might require expensive setup (minimum flow requirements, minimum order sizes, etc) especially if the flow is anonymous. HotspotFx might offer some insight. according to their own faq and also talking with brokers who actually connect to Hotspot, it is not very useful if you are not going to trade avg 100k minimum sizes (1.00 lot on mt4). You can customize feeds to get avg 1-10Mil top of book, but it would cost you. If you are looking to 'test' then you need to start with a quality retail broker who can give you PoP access.
I think your search of the avg retail fx broker revealed brokers who internalize nearly 100% of their flow, with no intention of actually making a market legitimately (the proverbial 'bucketshop') The OTC retail forex community does indeed have numerous conflicts of interest for the beginner trader. It's kind of like asking the casino how to blackjack is played. They can only provide the most basic rules. If they were to go in depth into how the cards were shuffled, why they serve you 'free' alcoholic beverages, etc. you could use that to develop an informed strategy (play to win against the house). Since the majority of casino games operate on a 'you lose, I win' profit model, the best way to manage the conflict of interest is to avoid playing at such venues.
A [bucket shop] retail forex broker has a similar 'broker profits = client loses' business model. So they have every incentive to give you information that makes you trade against yourself; your 'losses' become their 'profit', your profits = broker losses; and in some cases they will just cancel your trades and send you on your way. The correct way to make the market is to emulate market prices from Prime Broker/PoP add to spread or charge commission, match orders internally, and then send net exposure off to a wholesaler. In some rare cases, a retail broker will have a 100% agency model in place, and can prove so with proper post-trade reporting and a willingness to elaborate on specifics of the technology and practices they use to actually broker your order flow. To compare to a casino running a 100% agency model, it would be like a tournament or cash game where casino earns a rake for each game played. The casino doesn't worry about the edge of the players as they are playing against themselves. Casino only needs to provide the venue, dealer, etc for the event and take a commission for doing so.
To be fair, most retail brokers do not attract enough volume to operate profitably enough with pure agency model, or to completely offset (match) all orders in-house. Especially with increasing regulatory costs. Don't count on them telling you this though; they go through great lengths to mask their true business model and in some cases outright lie to their clients that they do not run a b-book, are STP/ECN/NDD, etc. They can easily create an offshore or hidden entity to STP their flow to or have deal with LP to receive rebate of losses. FXCM is the most high profile example of this (google
fxcm trades against clients; FinanceFeeds article).
- For USA residents,
Interactive Brokers was the last hope for
cheap, direct market access; FXCM had active trader acct (raw
spreads), but you read what happened. Gain Capital (forex.com) and
Oanda is all that is left [huge sigh]. You could ask for a 'raw
spreads' account if you meet certain minimum deposits or volume, but
can you be sure they are not 'trading against you'?
- Non US residents still have
Global Prime Au,
FxPIG, and a few
others to pick from (I keep a private list). Most public lists end
up spammy or blatantly advertise numerous bucket shops anyway because
advertising dollars trump honest information (yet another conflict of
interest). Pretty much you have either
Metatrader 4 or
FIX API + your own platform, but honestly a good broker could customize your mt4 feed so
you can avoid having to dabble with FIX messaging protocols which can
actually vary from broker to broker.
Once you get an honest broker sorted, then you focus on actual trading and algo development. Algo development and actual trading are what should be consuming the majority of your time. Avoid fake ECNs at all cost.....and there are a lot of them out there waiting to pounce on retail money.