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Forex changed forever!

  • #281
  • Jan 22, 2015 10:41pm Jan 22, 2015 10:41pm
Guys, do you seriously think that a massive selloff of 20 cents in 5 minutes were caused by retail forex traders?

Those were the big fishes with insiders data. We're safe; we're just trend followers.



On the other hand, Switzerland is just covering its ass. Doesn't want to go down with the Euro.
Trade, don't bet.
  • #282
  • Jan 22, 2015 11:30pm Jan 22, 2015 11:30pm
Quoting MarketFox
Guys, do you seriously think that a massive selloff of 20 cents in 5 minutes were caused by retail forex traders? Those were the big fishes with insiders data. We're safe; we're just trend followers. On the other hand, Switzerland is just covering its ass. Doesn't want to go down with the Euro.
I don't think anyone is saying it is the fault of retail traders. However, retail traders are the ones squealing about it so they are the ones that will suffer the changes, as are being evidenced already by leverage limits and balance requirements. Personally,I don't have a problem with demanding higher balances, it may get rid of some that shouldn't be here and puts more obligation on regulators to keep a closer eye on deposit holders, be they brokers or banks. What we don't need is more regulators poking their way an already complicated, although grey, marketplace.
Accept the risk folks, it's all part of it. When it goes against you, move on.
  • #283
  • Jan 22, 2015 11:39pm Jan 22, 2015 11:39pm
...and further, Interactive Brokers have now conceded that 80% of their losses came from futures contracts not spotfx and from only five clients. Obviously institutions, or other commercial operations. Anyone in the market may have potentially copped a loss, let's not make more of it than what it is or we are going to compromise future opportunity.
  • #284
  • Jan 22, 2015 11:51pm Jan 22, 2015 11:51pm
Quoting Greeny
...and further, Interactive Brokers have now conceded that 80% of their losses came from futures contracts not spotfx and from only five clients. Obviously institutions, or other commercial operations. Anyone in the market may have potentially copped a loss, let's not make more of it than what it is or we are going to compromise future opportunity.
I wish i'd picked up on the options trade for CHF. A few hedgies saw how cheap the options were (pretty mispriced as it turned out), and stocked up.
They're laughing now! Forex has been a great challenge, but I'm looking to get cleverer in the future (if this ponzi holds together for long enough!), basically see an opportunity and figure out how to do the trade - like XAU/EUR for example, may have been a great options trade.
"Risk comes from not knowing what you're doing." - Warren Buffett
  • #285
  • Jan 23, 2015 12:05am Jan 23, 2015 12:05am
Quoting Greeny
...and further, Interactive Brokers have now conceded that 80% of their losses came from futures contracts not spotfx and from only five clients. Obviously institutions, or other commercial operations. Anyone in the market may have potentially copped a loss, let's not make more of it than what it is or we are going to compromise future opportunity.

I'm puzzled by such a revealing speech from IBs part.

It seems like they are poking the regulators.

" look ...here....you guys blaming spot because of the lack of regulations. But the big loss came from futures which is very much regulated"

So, you think you have rights? LOL
  • #286
  • Jan 23, 2015 12:19am Jan 23, 2015 12:19am
Quoting ForexOracle
{quote} I'm puzzled by such a revealing speech from IBs part. It seems like they are poking the regulators. " look ...here....you guys blaming spot because of the lack of regulations. But the big loss came from futures which is very much regulated"
Maybe trying to take some heat out of it. It'd be a good idea for everyone to sit back and take the time figure out what actually did happen, if indeed anything did happen apart from an announcement from a CB that some hadn't factored in, before rushing in and making wholesale changes on the run. Cos we know how good governments and regulators are at that! We have plenty of rules already, some application of these rules in certain areas ( and I include Alpari in that given their last couple of years history, also the broker in NZ that closed up)might be a good place to start and leave the rest of us alone.It'll be interesting when stats from the likes of Citi and DB are released in three months time as to what happened with them really, again if anything.
  • #287
  • Jan 23, 2015 2:03am Jan 23, 2015 2:03am
http://forexmagnates.com/75-interact...tures-spot-fx/
  • #288
  • Jan 23, 2015 7:47am Jan 23, 2015 7:47am
The news don't stop coming ......

It seems that oanda is trying to buy Alpari.

Of course they are after their customers not the business model.

If the news is really true alpari will go right back to be a MM again.

Some people may say better a MM than bankrupt!

I'm not so sure of either.
So, you think you have rights? LOL
  • #289
  • Edited 6:53pm Jan 25, 2015 6:31pm | Edited 6:53pm
After a "one of a kind" move on the CHF pairs, we are starting to see ramifications we never saw before.

It seems APLARI customers will have to pay back their negative balances!!

I remember before I started trading forex, I ventured my self in equities.

One thing that scared me to death, was some fine prints saying in certain situations, you could end up having to pay your broker for losses.

So a few years later, here we are, ready to see if some "fine prints" will be enforced. Despite the fact it is the Forex market not equities.

I doubt they will be able to collect from people with negative balance.

What I think is going to happen is a "claw back" scenario.

Since people will just refuse to pay for their negative balance, LPs lawyers will get it from the segregated accounts.

So if you are a ALPARI client, even if you had zero exposure to CHF you will end up " contributing" with a percentage to make the LPs whole!!

Oh boy !!!! Forex will never be the same again !!!
So, you think you have rights? LOL
  • #290
  • Jan 26, 2015 9:58am Jan 26, 2015 9:58am
More bodies starting to float.

Boston prime and BT prime bankrupt!!

http://forexmagnates.com/exclusive-b...y-proceedings/
So, you think you have rights? LOL
  • #291
  • Jan 27, 2015 8:48am Jan 27, 2015 8:48am
So....

It seems FXCM lost more customers than expected which will bump the interest they are paying on the 300M from 17 to 20.5% ( ouch!!)

Clients money on segregated accounts went down from 1.33B to 1B or 25%.

My money collaborated for this drop.

I hate to see FXCM on this position because for the short time I traded with them I liked it.

I'm not worrying too much about my 2 main brokers ( IB and TS) but FXCM is a wait and see situation.

http://forexmagnates.com/fxcm-inc-un...ient-funds-25/
So, you think you have rights? LOL
  • #292
  • Jan 28, 2015 9:13am Jan 28, 2015 9:13am
Top 10 Forex forums

http://thetraderfx.blogspot.com/2015...ex-forums.html
  • #293
  • Edited 8:10pm Jan 31, 2015 7:46pm | Edited 8:10pm
Just 2 weeks after the SNBomb and I can't believe how forex already changed.

As traders we learned that:

1- Your stop loss ( and take profits) don't work in this kind of situations.
So from now on every time you set your stops remember that it only works in regular market conditions.

2- You can end up with a negative account and your broker has the right to collect it from you.
Till 1-15-15 the worst scenario for a trader was perceived to be a margin call, where you lose all your money.
FXCM and others broker legal teams are starting to send letters in order to collect the amount of the negative account from some of their clients.
So technically your losses don't have any floor under it. It can be infinite.

3- Segregated accounts don't mean anything.
ALPARI showed us that just like stop losses, segregated accounts are relative.
Depending on market conditions your "segregated" money will be used to cover losses that are not necessarily yours.

4- There is no practical limit for a currency movement.
Just 15 days ago if you opened a thread about the possibility of a daily move over 2000 pips on the majors. The smart a$$es here on FF would troll you to death and call you all the names they deserve themselves.
With more than 4000 pips in 5 minutes, the risk management for any major pairs was rewritten.
Banks, brokers, hedge funds etc are recalculating how many standards deviations to use from now on.
A precedent was set, so from now on if somebody contemplate a 8000 pip move on the EUR/USD it may not sound that crazy anymore.

Te list can go on with margin increases, new regulation proposals, bigger spreads and the always present risk of spot forex ending in the USA.

And we were introduced to all that in just 15 days !!

Forex changed forever
So, you think you have rights? LOL
  • #294
  • Feb 1, 2015 4:05am Feb 1, 2015 4:05am
Quoting ForexOracle
As traders we learned that: 1- Your stop loss ( and take profits) don't work in this kind of situations. 2- You can end up with a negative account and your broker has the right to collect it from you. 3- Segregated accounts don't mean anything. 4- There is no practical limit for a currency movement.
Aren't these things already common knowledge?
1) I'm sure even new traders know stops can get gapped over, so a fast large move can blow past any stop that isn't broker gauranteed.
2) Doesn't the PDS of every fx account mentions this? You trade on margin, you may end up with negative margin.
3) Who actually thinks segregated accounts are all that useful? Fund safety is only as good as the brokers solvency.
4) SNB already has a past of artificially manipulating the CHF, the EURUSD has no history. So bar a global or national disaster, yes an 8k pip move on the EURUSD would be a tad crazy... Earthquakes and tsunamis in Japan didn't result in such large a move and they're the 3rd largest economy in the world.
  • #295
  • Feb 1, 2015 5:17am Feb 1, 2015 5:17am
Quoting jeanlouie
{quote} Aren't these things already common knowledge? 1) I'm sure even new traders know stops can get gapped over, so a fast large move can blow past any stop that isn't broker gauranteed. 2) Doesn't the PDS of every fx account mentions this? You trade on margin, you may end up with negative margin. 3) Who actually thinks segregated accounts are all that useful? Fund safety is only as good as the brokers solvency. 4) SNB already has a past of artificially manipulating the CHF, the EURUSD has no history. So bar a global or national disaster, yes...
Easy to say what you are saying AFTER THE FACT....no ?

Just like yesterday's chart. Well, anybody can trade yesterday's chart.

So, for you to talk about what happened as "common knowledge" I think your post is 16 or 17 days late!!

Sorry but I can't buy what you are suggesting pal.
So, you think you have rights? LOL
  • #296
  • Feb 1, 2015 12:16pm Feb 1, 2015 12:16pm
Quoting jeanlouie
{quote} Aren't these things already common knowledge? 1) I'm sure even new traders know stops can get gapped over, so a fast large move can blow past any stop that isn't broker gauranteed. 2) Doesn't the PDS of every fx account mentions this? You trade on margin, you may end up with negative margin. 3) Who actually thinks segregated accounts are all that useful? Fund safety is only as good as the brokers solvency. 4) SNB already has a past of artificially manipulating the CHF, the EURUSD has no history. So bar a global or national disaster, yes...
Dead on. We probably won't witness another move like that in our lifetime. However, as a US resident, the good 'ole NFA is going to put new restrictions in as if this is an everyday occurrence. They are doing it after the fact, while the rest of THE WORLD is returning to normal. 3 brokers were hurt out of 200+. The smart brokers reduced leverage on the CHF months ago, now have it back to normal. In this ass backwards country, the NFA is reducing leverage now.
  • #297
  • Feb 1, 2015 12:34pm Feb 1, 2015 12:34pm
Quoting ForexOracle
{quote} So, for you to talk about what happened as "common knowledge" I think your post is 16 or 17 days late!!
I wasn't suggesting that the event itself was common knowledge (though the point that SNB intervenes is). I was speaking about your 4 points that you suggested that traders had suddenly discovered from the event. ie. "As traders we learned that: 1-2-3-4"

Just like what ProfitDaily said, "The smart brokers reduced leverage on the CHF months ago", this isn't the first time SNB has caused a large unexpected CHF move. Sure the move this time was gigantic, but not totally unexpected, due to the SNB's past before this recent event, no one/broker should ever have large positions on the CHF.
  • #298
  • Feb 1, 2015 1:38pm Feb 1, 2015 1:38pm
Quoting jeanlouie
{quote} I wasn't suggesting that the event itself was common knowledge (though the point that SNB intervenes is). I was speaking about your 4 points that you suggested that traders had suddenly discovered from the event. ie. "As traders we learned that: 1-2-3-4" Just like what ProfitDaily said, "The smart brokers reduced leverage on the CHF months ago", this isn't the first time SNB has caused a large unexpected CHF move. Sure the move this time was gigantic, but not totally unexpected, due to the SNB's past before this recent event, no one/broker...
I'd have to agree, I don't think any of those points are new knowledge to traders. Stops can be gapped in large amounts just by holding a position over the weekend, usually not to such a degree, but the outcome is similar.
  • #299
  • Feb 1, 2015 6:24pm Feb 1, 2015 6:24pm
Quote
I wasn't suggesting that the event itself was common knowledge (though the point that SNB intervenes is). I was speaking about your 4 points that you suggested that traders had suddenly discovered from the event. ie. "As traders we learned that: 1-2-3-4" Just like what ProfitDaily said, "The smart brokers reduced leverage on the CHF months ago", this isn't the first time SNB has caused a large unexpected CHF move. Sure the move this time was gigantic, but not totally unexpected, due to the SNB's past before this recent event, no one/broker should...


Quote
I'd have to agree, I don't think any of those points are new knowledge to traders. Stops can be gapped in large amounts just by holding a position over the weekend, usually not to such a degree, but the outcome is similar.

Oh please!

Just look at FF brokers thread.

You had like over 200 people following the thread during and after the event.

Thats the attendance on the EUR/USD thread on NFP time.

People were there to learn what was going on.

The vast majority of retail traders have a different view of forex now than 17 days ago.

Find me one, JUST ONE thread or even 1 post before 1-15-2015 about Forex negative balance, or 4000 pips moves in 5 minutes.

Common knowledge !!! LOL !!!

Yesterdays chart are also common knowledge!!
So, you think you have rights? LOL
  • #300
  • Feb 1, 2015 9:57pm Feb 1, 2015 9:57pm
Quoting ForexOracle
{quote} {quote} Oh please! Just look at FF brokers thread. You had like over 200 people following the thread during and after the event. Thats the attendance on the EUR/USD thread on NFP time. People were there to learn what was going on. The vast majority of retail traders have a different view of forex now than 17 days ago. Find me one, JUST ONE thread or even 1 post before 1-15-2015 about Forex negative balance, or 4000 pips moves in 5 minutes. Common knowledge !!! LOL !!! Yesterdays chart are also common knowledge!!...
Exactly, never happened before and you won't see it again in the next 40 years. Now we are going to change all the rules and leverage for something that's already happened and has a 99.9% chance of never happening again. That's my point regarding everyone freaking out about leverage. many of the 200+ brokers in the world offer 400 and 500 to 1, and you are right I cannot find one prior post regarding negative balances, not even when the SNB imposed the peg or the Japanese earthquake and tsunami.
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