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Stop Hunting

  • #1
  • First Post: Edited 2:50pm May 10, 2006 2:35pm | Edited 2:50pm
For those of you who do not believe that stop hunting occurs, I thought I would provide a real example. This happened just today after the FOMC announcement.

This is the image of the stop hunt. This was a live account with a 100 lot sell trade on. Notice the bar with the arrow pointing to it. This was the first move following the announcement. Notice that the price went to 1.2826
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  • #2
  • May 10, 2006 2:47pm May 10, 2006 2:47pm
Who is the broker?

And is that chart a false one? I mean like broker streamed wrong prices to trigger lots there?
  • #3
  • May 10, 2006 2:49pm May 10, 2006 2:49pm
Quoting stockwet
For those of you who do not believe that stop hunting occurs, I thought I would provide a real example. This happened just today after the FOMC announcement.

This is the image of the stop hunt. This was a live account with a 100 lot sell trade on.
Forgive me...what makes this a stop hunt, exactly? Are you saying you had a stop somewhere in there?

No denying, stops do get "cleaned up", but I'm not sure what I'm looking for in your example? After all, volatility WAS expected...and technically, what I think happened was a brief word that got out that the feds were NOT going to stop raising the rates, and then the statement was that they MAY not raise the rates based on economic data.

We've seen these types of moves before. It's a quick misinterpretation of news and then a really quick fix by millions of traders and billions in liquidity at that second. NFP and FOMC meetings happen to do this often. If you sold this news your stop didn't get hit because it was hunted...it got hit because the collective body of traders quickly interpreted something different than you did when you initially got in...if you look at the price now, we're actually HIGHER NOW than we were before the news was released...I suspect a bunch of people just like you sold the news with the expectation the fed couldn't pause because of inflationary pressures, but then a bunch more realized that they may indeed have to stop or risk damaging some major markets (housing, small business) out there.

I think if you want to see stop hunting, look at trading in the wee hours before the london open...that's when most stops get cleaned, I would suspect.
  • #4
  • May 10, 2006 2:51pm May 10, 2006 2:51pm
Hang on, I'm not done yet.
  • #5
  • May 10, 2006 2:53pm May 10, 2006 2:53pm
Here's the chart, same timeframe, for GFT Forex. Yes, this is a live account. The price hits 1.2809.

And, no, I'm not done yet.
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  • #6
  • May 10, 2006 2:54pm May 10, 2006 2:54pm
Here's a chart from InterbankFX, another live account. The price hits 1.2809. And, no, I'm not done yet.
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  • #7
  • Edited 3:10pm May 10, 2006 2:58pm | Edited 3:10pm
These next two charts are from demo accounts. One is for OandA, the other is, believe it or not, from the demo feed for the broker who, purportedly, executed the stop hunt.

Keep in mind that on some of these, I came in well after the move to take screenshots. So, some of them have additional bars. The second graph has an arrow pointing to the relevant bar. All of these are 15m charts, except for OandA.

Yes, I'm done now.
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  • #8
  • May 10, 2006 2:59pm May 10, 2006 2:59pm
The second chart.
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  • #9
  • May 10, 2006 3:00pm May 10, 2006 3:00pm
On my Account, the price hit 1.2809 high just before FOMC, after the news it gave a low of 1.2747 and THAN it formed the other green candle which went up to 1.2829.


In your first pic its showing 1.2815+ in very frst red candle, which never happened.
  • #10
  • May 10, 2006 3:04pm May 10, 2006 3:04pm
Quoting Purple
Who is the broker?

And is that chart a false one? I mean like broker streamed wrong prices to trigger lots there?
First off, I will not say who the broker is. I think they get a fair shake at explaining this anomaly before getting killed in any online posts. The purpose of this was not to smear the broker.

Second, regarding whether this is a false chart. I'm not sure. I don't think anyone can be sure in these cases. Stop hunting implies that there was intent to manipulate prices by the bank. Proving that intent is nearly impossible, which is why there's such a fervent debate regarding price hunting. So, I use the term loosely.
  • #11
  • May 10, 2006 3:06pm May 10, 2006 3:06pm
Quoting Purple
On my Account, the price hit 1.2809 high just before FOMC, after the news it gave a low of 1.2747 and THAN it formed the other green candle which went up to 1.2829.


In your first pic its showing 1.2815+ in very frst red candle, which never happened.
Precisely. That was the candle in which the trade was stopped out. Ignore the subsequent candles since they came after the trade was over as a result of the stopout. It took me time to go to all the different accounts and take the screenshots. I'm aware that the price eventually climbed back up to that level, but, not until after the trade's TP was reached on the bottom end. Unfortunately, the errant price stopped the trade out before it hit the TP target.
  • #12
  • May 10, 2006 3:16pm May 10, 2006 3:16pm
Quoting stockwet
For those of you who do not believe that stop hunting occurs, I thought I would provide a real example. This happened just today after the FOMC announcement.

This is the image of the stop hunt. This was a live account with a 100 lot sell trade on.
Doh, I was looking at the wrong bar. Sorry to dispute. Your totally right about that being a bogus move.
  • #13
  • May 10, 2006 3:17pm May 10, 2006 3:17pm
Quoting stockwet
Precisely. That was the candle in which the trade was stopped out. Ignore the subsequent candles since they came after the trade was over as a result of the stopout. It took me time to go to all the different accounts and take the screenshots. I'm aware that the price eventually climbed back up to that level, but, not until after the trade's TP was reached on the bottom end. Unfortunately, the errant price stopped the trade out before it hit the TP target.
A few things to note here.

I see the first chart hitting 26 on the red candle, but none of the other charts do including your last one (which I thought was a reposting of the first one). Did you notice that? or did I misunderstand what you meant by the "second chart" as it looks like it's on the same platform as the first chart.

Secondly, during FOMC news, a 20 pip stop? I'm not going to try and understand what the reasoning is, but 20 pip volatility is so common during news releases.
  • #14
  • May 10, 2006 3:24pm May 10, 2006 3:24pm
yup I have been hunting for a while on COES and that sure looks like a phony candle to me... Have you sent this info to the broker and asked them to explain it? The 20 pip stop is close, but not really the point... the phony candle is the point...



Quoting stockwet
Precisely. That was the candle in which the trade was stopped out. Ignore the subsequent candles since they came after the trade was over as a result of the stopout. It took me time to go to all the different accounts and take the screenshots. I'm aware that the price eventually climbed back up to that level, but, not until after the trade's TP was reached on the bottom end. Unfortunately, the errant price stopped the trade out before it hit the TP target.
  • #15
  • May 10, 2006 3:31pm May 10, 2006 3:31pm
[18:46 EUR/USD: EUR/USD Option Barriers Break] New York May 10. The defense of option barriers at 1.2815 which had repelled every attempt to break out of the topside finally gave way. FX traders are responding to each tic in the 10Y Treasury note. We registered a session low of 1.2755, marginally above stop losses at the 50 level. Eager buyers of EUR sopped up the wave of selling, and we built up enough kinetic energy to rip through the topside. We are bouncing off 1.2830, here are 1.2850 barriers, and 1.29s. We also hear there are huge sell orders at 1.3000. Watch this space. [email protected]

Heres the thomson report stating that it didn't touch the 1.2815 option levels until AFTER the big down move. It seems highly unlikly that yours was the only trade that was smoked out in that move. Raise holy hell with em!
  • #16
  • May 10, 2006 3:34pm May 10, 2006 3:34pm
Quoting Darkstar
Sorry to burst your bubble, but the OTC interbank eur/usd hit 1.2833 in that move. The rest of your sighted brokers quotes are off...
Sorry, it doesn't burst my bubble. Clearly, you didn't read my entire post. I'm well aware that the SUBSEQUENT candle reached 1.2833. But, not the candle that the stopout occurred on.

Here, this will be a bit more clear. I have images from the 1 minute candle. Since you seem well connected to the OTC market, please find me a broker or bank that traded EURUSD at 1.2826 at 2:15 PM EST as this broker did. The first image is the stop hunt, or, if you will, the errant price bar. The second is from InterbankFX.
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  • #17
  • May 10, 2006 3:35pm May 10, 2006 3:35pm
InterbankFX 1m chart.
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  • #18
  • May 10, 2006 3:36pm May 10, 2006 3:36pm
Sorry DarkStar,

I was getting a little snippy with you.

Regards,

stockwet
  • #19
  • May 10, 2006 3:37pm May 10, 2006 3:37pm
Quoting stockwet
Sorry, it doesn't burst my bubble. Clearly, you didn't read my entire post. I'm well aware that the SUBSEQUENT candle reached 1.2833. But, not the candle that the stopout occurred on.

Here, this will be a bit more clear. I have images from the 1 minute candle. Since you seem well connected to the OTC market, please find me a broker or bank that traded EURUSD at 1.2826 at 2:15 PM EST as this broker did. The first image is the stop hunt, or, if you will, the errant price bar. The second is from InterbankFX.
Yeah I miunderstaood what you were saying. I corrected my post earlier.

And I meant the REAL interbank, not the bucket shop...
  • #20
  • May 10, 2006 3:38pm May 10, 2006 3:38pm
Quoting stockwet
Sorry DarkStar,

I was getting a little snippy with you.

Regards,

stockwet
It's all good brother. If i were in your position I think I would be throwing things.
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