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Broker Manipulation

  • #61
  • Edited 1:24pm Aug 2, 2012 1:10pm | Edited 1:24pm
ez0770 - Sounds interesting I will look into it when I get some time. My opinion though, it's not necessary for brokers to try to flash the market 10 pips. They don't need to move the market. They can fake the market 20 pips any time. But what your talking about may be applicable to the big banks/ hedge funds, that are not part of the very big banks that do the controlling.

Anyway straight to the good stuff. Today was a brilliant day for manipulating opportunities. ECB press release... doesn't get any better. Can anyone give me the high's and lows on there charts of the major currencies today, euro, gbp, chf, aud, jpy, and if they really care some print outs of there charts using control c to copy, and control v to paste on a paint screen.

If anyone can post this, i'm sure we can isolate some very big manipulation with IB... Perfect examples after todays discussions.

@trader121, your comments on forex and casino are great. It is a big casino, and if you look at it to have fun and not make money its not so bad. I have great fun when i'm trading, sometimes it makes me wanna shit my pants. Also I am working on changing brokers, prob is I hate MT4.

Also, IB is only a STP broker when they choose to be. Unfortunately this is at there discretion, and there is no way to tell if they are passing the trades through, or holding them for there own benefit. From my experience, they only pass through very big lot trades, or trades from customers who have prooven to be very good. Otherwise they hold the trades, maniupulate the feeds ect, and take the profits. Also for no stated reason, they won't accept trades bigger than 50 lots. Very strange for a stp ecn broker. Not that I have tried 50 lots though...


Bring on the high's lows on the majors of todays ECB press release!!!!!!!!!!!!!!!!!!!
  • #62
  • Aug 2, 2012 1:21pm Aug 2, 2012 1:21pm
Algos are definitely used by hedge funds and banks, but big broker/dealers use them as well....to be honest I have never seen spreads of 20 pips on majors maybe 10-15 in very thin/illiquid market but just for a few minutes

Isn't IB a straight-through-processing broker though?

Quoting Eatmypips
ez0770 - Sounds interesting I will look into it when I get some time. My opinion though, it's not necessary for brokers to try to flash the market 10 pips. They don't need to move the market. They can fake the market 20 pips any time. But what your talking about may be applicable to the big banks/ hedge funds, that are not part of the very big banks that do the controlling.

Anyway straight to the good stuff. Today was a brilliant day for manipulating opportunities. ECB press release... doesn't get any better. Can anyone give me the high's and...
  • #63
  • Aug 2, 2012 5:24pm Aug 2, 2012 5:24pm
Quoting ez0770
@ Pidgeon and Eaetmypips, thanks for your reply first of all. I wanted to raise a couple of points based on what you guys are saying here:

1) You agree that your broker cannot move the real market price against you, but they can only manipulate the price that they show you by shading it. The solution in this case is quite simple, get your chart data from a different and more reliable source and if you see a massive discrepancy in pricing in non-fast market conditions just change broker and maybe go for a stp broker ( I thought IB was stp by...
Personally and with all due respect, I don't think you can use algos to trade sub-day and day moves. They appear way too discretionary and contextual to me. I can see algos catching noisy momentum for a few pips here and a few pips there, but daily moves reflecting sentiment are, I suspect, guided by the human mind. Personally, I can't see these moves being automated (unless of course, they develop a sentient computer.)

Good technical trading of these moves IMHO, takes lots of hard work and sweat. Alternatively theres good fundamental trading or using order flow, both of which Dark Star appears to use to good effect. OR of course, refined momentum which probably calls for a detailed understanding of indicators... but I am no expert here...there are those better able to comment on this than I.

But there's no short cuts in technicals, of that I am pretty sure. It's hard work and very complex (for that consistent success).

Last nights (NZ time) buy AND sell of the Euro was there, on the charts, if you knew what you were looking for.

So to those who despair at broker manipulation. There's no substitute for hard work is my advice, whichever style you use to trade. But technicals are painstakingly slow unless you are a fast intuitive learner which I am not.
The road to pipland is arduous and fraught with challenge.
  • #64
  • Aug 2, 2012 11:06pm Aug 2, 2012 11:06pm
Quoting Eatmypips
Anyway straight to the good stuff. Today was a brilliant day for manipulating opportunities. ECB press release... doesn't get any better. Can anyone give me the high's and lows on there charts of the major currencies today, euro, gbp, chf, aud, jpy, and if they really care some print outs of there charts using control c to copy, and control v to paste on a paint screen.

If anyone can post this, i'm sure we can isolate some very big manipulation with IB... Perfect examples after todays discussions.
You actually think IB is manipulating their prices? Seriously? If they did post off quotes I would love it because I and many other funds would hit it with size for a free arb opportunity. From my experience IB is one of the few retail brokers where you don't get shafted.

Quote
Also, IB is only a STP broker when they choose to be. Unfortunately this is at there discretion, and there is no way to tell if they are passing the trades through, or holding them for there own benefit.

By IB's policy they must pass on price improvement to the customer if they take the other side of the trade. Just look at your fill prices and it should be relatively easy to figure out.

Quote
From my experience, they only pass through very big lot trades, or trades from customers who have prooven to be very good. Otherwise they hold the trades, maniupulate the feeds ect, and take the profits.

You state above you have no idea when they pass through orders and when they step in, then you say they only pass through large lots. Which is it?

The other allgations are serious but I haven't ever experienced any of those. Sometimes markets move very fast. You can lose or make lots in a short period of time. Sounds like you're on the losing end of things and should focus on more stable trading conditions. If you are experiencing held trades, manipulated feeds then you should check your internet and hardware for backlogs.

Quote
Also for no stated reason, they won't accept trades bigger than 50 lots. Very strange for a stp ecn broker. Not that I have tried 50 lots though...

Clearly just complaining to complain. They have a policy. You don't like it. Get over it. Focus more on your strategies and less on what you think others are doing. It is a fair marketplace with IB.
  • #65
  • Aug 2, 2012 11:07pm Aug 2, 2012 11:07pm
Quoting traider
Personally and with all due respect, I don't think you can use algos to trade sub-day and day moves. They appear way too discretionary and contextual to me. I can see algos catching noisy momentum for a few pips here and a few pips there, but daily moves reflecting sentiment are, I suspect, guided by the human mind. Personally, I can't see these moves being automated (unless of course, they develop a sentient computer.)
Ok if you say so.
  • #66
  • Aug 2, 2012 11:17pm Aug 2, 2012 11:17pm
Quoting FXEZ
Ok if you say so.
Thats my reasonable assumption but of course I may be wrong. I'm all ears as to how they can automate these quite specific but highly variable moves (as opposed to noise.)

Any ideas?
The road to pipland is arduous and fraught with challenge.
  • #67
  • Edited 1:34am Aug 3, 2012 12:21am | Edited 1:34am
Quoting FXEZ
Ok if you say so.
With threads like this, that's what I end up saying.

The only reason I bother posting is for rookies out there to at least have a second opinion among all this nonsense by people who don't really know what they're talking about. I'm referring to statements like "you can't make money in retail fx", "forex is rigged", "retail fx is just a casino", "brokers/algos/etc are out there to get you", and so on. They're just ways to avoid saying "I've had enough losses and I'm giving up", there's some useful insight into the psychology of human traders in this, they don't react well to losses.

So one more time:

"you can't make money in retail fx"

You CAN make money consistently in retail Forex. All you need is:

1) An edge. The ability to time your entries correctly with enough consistency to make money consistently.
(this is the tough part and what you should focus on, once overcome the rest is easy in comparison)

2) A bröker with no conflict of interest with you.
(most retail brökers do, to various extents. Some bucketshops plain trade against you, some MM's and so-called ECN's don't but they are exposed to some of your trades and need to hedge their net exposure against them. But a few true ECN's do neither, zero conflict of interest. i.e. They literally couldn't care less what you trade, they just take commissions and pass your orders anonymously to a network of liquidity providers, it's easy money for them and they're happy with it and won't try to play games.)

"forex is rigged"

Rigged by who and against whom? If you mean by the big institutional players against retail players like us, then no. Do they have more experience, money and resources? You can bet your ass they do. Does it mean you can never make money? Of course it doesn't, just think like them and place the right bets, lol. Just because there are Bill Gates out there doesn't mean you can't actually have a profitable business, even if it means clashing with those guys in the market every now and then. That's your mistake, not theirs. People are in this to make money. You just have to find your edge. The market is too big and complex not to allow small traders to make it if they can make the right bets.

"retail fx is just a casino"

If you mean something you can never make consistent money at because of a edge in favor of "the house", then no, because unlike casino games, the market is not random.
If you mean something like it's a big worldwide poker table, a zero sum game where people win from others' losses, then yes it is.

"brokers/algos/etc are out there to get you"

And who the hell are you? lol People who say this usually overestimate their size and significance as a market participant. If you think like the losing majority does and consistently position yourself in the wrong direction then of course you'll lose and they'll win, what did you expect? Would that be because of some conspiracy of a "rigged game"? No, it's because you're not as good, you got no edge of your own. (assuming of course you're not being robbed by some shady bucketshop, that also happens but, as I said, can be avoided)

"Stop hunting" and stuff like that is normal in any market. For example, sometimes there are big concentrations of stops and sometimes price gravitates toward them (big players triggering them to fill their big orders for a cheap price). That's NORMAL in any market. Like I said, it's a war out there. If you don't like the rough, highly competitive nature of trading or think it's immoral or something, then perhaps you shouldn't be trading. Just don't blame it on the market per se.

Hope that helps.

Bye thread.
  • #68
  • Aug 3, 2012 12:46am Aug 3, 2012 12:46am
I don't often comment on stuff like this, but here goes - becuase something irks me about this thread.

sure IB's feed is different from other brokers, but this isn't totally surprising as Spot Forex isn't a centralised exchange/market. so IB probably use a different set of banks/liquidity providers. So it's not surprising to see differences in feeds - especially during times of low liquidity. All perfectly normal considering the way spot FX works.

why not trade FX futures? you seem to have the account size to work that - and I know many traders with larger bank rolls do this. This way you'll also get other things like DOM and you are trading from a more exchange based environment - no broker manipulation. But you'll still have big players hunting stops and other goodies

Also, i severely doubt your broker is deliberately targeting your stops, even though it feels that way.

I'd wager you are placing your stops in a fairly obvious places & too tightly, and big institutional traders are very deliberately hunting your and every other person's obvious stops. You see this on any brokers charts. I actually anticipate it, and then trade. I adapted.

Not sure what your system is, nor do I care to know - but obviously market conditions have changed, and it's your job as a trader is to adapt to changing market conditions - or lose money.

Once upon a time Moving Average Crossovers and Stochastics worked - and who would use those indicators in the traditional way now? Only a chump IMHO.

Trading is a battle between people trying to take money from each other. "The Market" or "The broker" isn't against you - it's not personal.

People with enough money to move the market try and figure out what naive traders are doing, and exploit that.

Also, currently we are in Summer holiday doldrums with many traders on holidays ( and probably off watching the olympics ) which is exactly the opposite of doldrums as there are many liquidity issues, and over exaggerated moves due to this.

I doubt your broker has the time or inclination to target or manipulate your feed. Imagine the overhead in managing all that manipulation! But agree that your feed probably will vary from other brokers from time to time.

Also, if you are trading at market during NFP - then you truly are deluded if you want to whine about slippage or other order placement issues. Trading @ market during NFP or any other major economic report is a crap shoot, and no broker is immune to delays and liquidity issues under those conditions.

I never ever trade during those kinds of moves. It's a sucker's game IMHO.

Anyway, good luck. Apologies if I came across as insensitive, but i think you need to review your system, and adapt to a market that deliberately hunts obvious stops.

Nothing stays the same.

Seb
- Look to the left, Trade to the right - I am the system
  • #69
  • Aug 3, 2012 1:20am Aug 3, 2012 1:20am
Well said Sebastian.

Before I go. See attachment. EURUSD, Hourly.

Why do you think price went up there precisely, and in that manner?

Was it "my bröker hunting my stops"? It might certainly feel that way (especially if I was still a noob) and rage over it. But hell no, my bröker has got nothing to do with it.

The truth is stuff like this happens in any market. You just gotta survive it all, the bluffs, the fake trends, fake reversals, fake signals, stop hunts, etc. You just gotta find and maintain your edge.
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  • #70
  • Aug 3, 2012 4:06am Aug 3, 2012 4:06am
Really good posts by Marv and Sebastiaan.

traider:
Quote
Any ideas?
I'll just add that I still see opportunity for new traders who can spot market inefficiency. Markets pay participants for making them more efficient, so if you can find an inefficiency, you're most of the way there. It should be fairly straightforward (not easy but straightforward) to design multiple systems to take advantage of that inefficiency, and these will exploit your edge.

Rather than get into specifics I'll let those who are looking do their own research. This might lead your studies into areas of order flow trading (if you're more manual trading / news / fundamentals inclined) or relationship trading aka stat arb which can work for both manual or automated traders and can be relatively simple or extremely complex.

But there may be other ways to get there so at a minimum read up on market microstructure (Harris) but most of all do your own research and think about how the markets move and what recurring technical or fundamental patterns can create opportunity to exploit inefficiency. Then design a trading system to exploit that inefficiency.

Then keep us updated via postcard from tropical resort.
  • #71
  • Aug 3, 2012 7:35am Aug 3, 2012 7:35am
Quoting FXEZ
Really good posts by Marv and Sebastiaan.

traider:
I'll just add that I still see opportunity for new traders who can spot market inefficiency. Markets pay participants for making them more efficient, so if you can find an inefficiency, you're most of the way there. It should be fairly straightforward (not easy but straightforward) to design multiple systems to take advantage of that inefficiency, and these will exploit your edge.

Rather than get into specifics I'll let those who are looking do their own research. This might lead your studies...
I have tended to develop my own style as it gives me results which after all is what this game is about. For example, I steer well clear of inefficiencies (as I see them) and instead look for a market that is discernable (efficiencies as I see them).

At that level of efficiency as I would construe it, I have found the market tends to set its sub-moves and moves for the day. Once it breaches that efficiency, you will get a swift and volatile reversal or drifting sets in. However, these efficiency signals I use are varied....I have a long list to tick off in other words.

Which is why I believe you cannot code these signals...they are too discretionary and specific....but I may well be wrong and will look into this further when I have the time. I have something that is 100% spot on so anything that adds depth to it is all good. Dark Stars stuff warrants looking at as well. I have only read good feedback on his ability.

My occasional forays on here however are to simply remind traders that consistent trading is possible...it takes a good deal of work and intuition....but it can be done. Don't be put off by all this talk about dodgy brokers or ultra fast computers. It's easy as when you get to understand the markets dynamics.
The road to pipland is arduous and fraught with challenge.
  • #72
  • Aug 4, 2012 10:44am Aug 4, 2012 10:44am
http://www.zerohedge.com/news/interv...equency-trader
  • #73
  • Aug 5, 2012 3:38am Aug 5, 2012 3:38am
Quoting ez0770
http://www.zerohedge.com/news/interv...equency-trader
This article is Excellent, thanks for the link.
Forex is a losers game.
  • #74
  • Aug 5, 2012 11:09am Aug 5, 2012 11:09am
Quoting trader121
This article is Excellent, thanks for the link.
I would take that article with a very big grain of salt... from the beginning, it is clear that he has an axe to grind. In the first answer he states

Quote
Beginning with the July 2011 crash, our strategy no longer seemed to be working. We lost a lot of our clients’ money – nearly 40%. It was brutal.

After reading the whole article, i didn't have the feeling that he was impartial and also there were some statements that made me doubt that he really understands market microstructure as much as he claims to do.
I'm not insane; my mother had me tested.
  • #75
  • Aug 5, 2012 11:23am Aug 5, 2012 11:23am
Hi RoBiK,

do you have any direct experience in the HFT space within forex? Do you think it's possible for algos to employ similar strategies as the ones they (supposedly) employ in the equity and futures markets?

Quoting RoBiK
I would take that article with a very big grain of salt... from the beginning, it is clear that he has an axe to grind. In the first answer he states



After reading the whole article, i didn't have the feeling that he was impartial and also there were some statements that made me doubt that he really understands market microstructure as much as he claims to do.
  • #76
  • Aug 5, 2012 1:06pm Aug 5, 2012 1:06pm
Quoting Marv
Well said Sebastian.

Before I go. See attachment. EURUSD, Hourly.

Why do you think price went up there precisely, and in that manner?

Was it "my bröker hunting my stops"? It might certainly feel that way (especially if I was still a noob) and rage over it. But hell no, my bröker has got nothing to do with it.

The truth is stuff like this happens in any market. You just gotta survive it all, the bluffs, the fake trends, fake reversals, fake signals, stop hunts, etc. You just gotta find and maintain your edge.
My money is on supply & demand and nothing else
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  • #77
  • Aug 5, 2012 2:41pm Aug 5, 2012 2:41pm
Quoting GDR3k
My money is on supply & demand and nothing else
If it works for you it's good.
  • #78
  • Aug 5, 2012 3:15pm Aug 5, 2012 3:15pm
Quoting Marv
If it works for you it's good.
As well as the obvious buy/sell orders around psychological levels.
  • #79
  • Aug 5, 2012 4:36pm Aug 5, 2012 4:36pm
So anyway, no-one's posted the high's and lows from Thursdays ECB press release...

Interested to know if Eur broke above 1.2400 as yahoo suggests a high of 1.2376???

Same with Aud?
  • #80
  • Aug 5, 2012 6:28pm Aug 5, 2012 6:28pm
Quoting Eatmypips
So anyway, no-one's posted the high's and lows from Thursdays ECB press release...

Interested to know if Eur broke above 1.2400 as yahoo suggests a high of 1.2376???

Same with Aud?
My broker's feed (Vantage FX ) did hit a high of 1.24039 and a low of 1.21330.

The fact that differs from Yahoo is irrelevant, and is probably attributable to different liquidity providers and data feeds.

What is your take on why the feeds differ?
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- Look to the left, Trade to the right - I am the system
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