Ibfx,fxcm,saxobank Chart Comparison Everyone Read This

I want everyone to look at these charts and please explain to me what exactly transpired. I don't want to be a cheerleader for saxo bank or anything but i think this is where the line is drawn between these so called market makers and an actual bank where this kind of BS would be considered theft.

I have the spike here on IBFX, too. I, however, don't trade this pair.

Be aware that IBFX (I don't know about FXCM) doesn't have fixed spreads, may have been the cause for some reason. But this 43 pips whipsaw is indeed wierd.

I figured this was Jul 23rd 1:00 am (GMT), what leads us to a news release in Australia by 1:30 am (AUDUSD has a 9 pips whipsaw in the same candle).

There are 2 explainations: bad feed or big spreads by that time....

IBFX and FXCM also show spikes at around 21:00 on 7/24 and Saxo doesn't.

if it means its a bad feed then i guess both ibfx, fxcm all these brokers get from the same place.

The only way to overcome these is don't set your stops too tight.

But still a very dishonest trick.

I would venture to say that this all comes down to these clowns using the same dealing desks. Yes, dealing desks.

Lehman Brothers, DB, Citibank are all part of IBFX's clearing. Considering that these are some of the largest dealing desks that I know of, it wouldn't surprise me at all if these douchesickles (both IBFX and FXCM) were getting feeds from same places. So.....you have to ask, did Citi spike their price looking at juicy orders? Could a bank actually do something dishonest? How about claiming 9 times (legally) your deposits? Ok, I won't rant about banks. And bankers. And how they can't fly when you throw them out of a 22nd story window. (Ahem....)

Anywho. Don't kid yourself, I have heard a lot of bitching about Saxo spiking prices. Keep in mind, you are NOT trading on an exchange, and that by it's very nature means that Citi or Lehman can charge whatever in the hell they want for the EUR/JPY pair. Is it fair? No. But then again, it's not fair I am only 5'7" either.

If you are serious concerned about it, the only option is trading at places like the CME, CBOT, etc, etc.

Clockwork

Just because the chart is smooth does not mean that you will get filled in a volitile market. remember that all banks are just big market makers. Idealy if you have 8-10 banks feeding into one platform you would be able to aviod big spikes like this. if you ask me i would say that IBFX and FXCM are probably using some sort of stock feed and then "manually" passing off their risk to one of thier large banking partners depending on who is giving them the best price.

To tell you the truth as banks start to get into the retail FX game i think that we are starting going to start seeing more of the games that dealing desks have been playing. except that your broker isnt going to be able to get any of your money back from the bank!

call me crazy but i think there might come a time when retail traders are begging for an honest desk.

Lets not forget that he is looking at three demo accounts and has not said a single word about execution with any of these brokers. Meaning this thread is BS and who cares about a spike on a demo? Spikes happen and if you get filled on a BS spike then we should talk about it and until then why dont you spend your time trading a live account instead of bit*hing about demo accounts.

The chart on fxcm is from a real account!!!!!! The others are demo.

I was in on that whole drop down right from 0.7725 and i had a very profitable trade on a live account. My problem is that had i ran my stop a little bit closer i would have been taken out earlier on a very good position that i had built.

Having said that, i think i would have been pretty mad if i did get taken out earlier.

The real questions is did this spike happen only at these retail places or did it come from their bank feed?

Yeah, correct those spike are from real chart, i checked it myself.

Razorman,

If you were affected on a live account my sincere apologies for my earlier comment. However, I think I can shed some light on the spike that you saw.

Every retail broker has to build some sort of pricing feed into their platforms, either a bank feed or another Market Makers feed. Where some brokers get a price feed can be anyones guess. However, if they are NFA regulated you can bet they are using a legit feed, i.e. a bank feed, another Market Makers feed or an ECN feed. Also, remember that the feed that is shown to you is the Market Makers feed and generally Market Makers only use that feed to show the end client a price. (meaning they book the trade) When they want to offset some risk they would do so with one of their liquidity providers.

Most Market Makers and ECN's now have multiple banks that they do business with and get liquidity from. However, if you are not seeing a variable spread with very low spreads you are probably not benefiting from that aggregated feed. Meaning that they use that feed to lower the Company's spread (the spread they can deal off of) and not the end clients spread. More than likely, a company like this is pumping their price feed with one bank or Market Maker and then marking up that spread for their clients to deal off of. Depending on the Market Maker they might be pumping in an aggregrated feed into the platform and then marking up that spread.

Regardless of how they do it, if one bank has a bad tick (which is a technical glitch generally resulting when the price being sent from that bank is way off market due to that banks technology not calculating prices correctly), then it shows up on your charts or platform as a huge spike. A lot of the times if you are not carefully looking at the price on the platform you would never notice the spike because it happens so fast. Instead you only notice it later on the chart.

Most retail brokers set up fail safes that will not allow any trades to get executed when a pair gaps an unimaginable amount in a matter of seconds. It can generally be discovered because the price gaps down very quickly but then the next tick is no where near that price. This is different then a gap that occurs around news because once the price gaps, the next tick will be close to the original gap. However, since charting is generally offered by a third party (for example say, Broker A uses Intellichart for their charting service, then Broker A gives their pricing feed to Intellichart and then Intellichart uses that feed for Broker A's charts) so that spike shows up on the chart even though you would not have been executed.

The spike you saw could have also been a legit spike as well. Since Saxo didnt show that same spike a couple of different scenarios are possible. One, they are not using the bank that gave the price spike. Two, and more likely their feed is aggregated and that spike was not shown because their was better pricing in the market. If it was not a legit price spike and they were using the same bank that gave the false spike they probably have a charting package where they have built in a fail safe that doesnt show bad ticks. I dont know if Saxo uses a third party for charting or if they do it in house.

It is important to remember, with NFA regulation tightening, the price that a client is offered has to be considered a reasonable price. Meaning that you cant get filled at 1.5600 for EUR in a non volatile market when every other Market Maker is offering 1.5700 (including banks and other Market Makers). However, as you can imagine this kind of terrible fill would be hard for us to get any kind of due compensation and it would be a pain for us to go through the process of NFA Arbitration.

I wasn't affected by it, but i was wondering if I had my stop withing the reach of that spike, would my trade be closed?

I guess unless i get caught in one of these will never know.