A retail forex company functions as the market maker for all your trades. They color prices, expand spreads arbitrarily, and trade against you. Their basically modern-day bucket stores. The advantages retail brokers supply are that you are able to open an account with very little money, they offer you crazy leverage, and typically you can demo trade in their platforms before you learn what you're doing. The majority of them also have micro and miniature lots so you can exchange very little sizes.

An ECN resembles an interbank broker. They do not trade against you so there's absolutely no need to manipulate the price. They combine bank quotes and show one of the very best bid and provides available. Spreads are tighter, but you need to pay commissions. Whenever you make a trade they pass it through to interbank, or so the counterparty is really a trader. Leverage is generally lower and minimal balances are greater. Interbank trades at $100,000 increments, so you need to be big enough to fit $7-10 per pip trades into one rmoney management.

--Forget about the day trading query--
For day trading, the ECN brokers are better because it is so much easier for the retail men to manipulate prices in the brief term. Also, most ECNs permit you to exchange between the bid and the ask, so you are able to own scalp as it was originally accomplished by floor traders.