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Coinexx Six Figure Loss Spread Manipulation

Discussion in 'Scam Alerts' started by preczau, Nov 9, 2018.

  1. preczau

    preczau Recruit

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    Having read all the great reviews online, I opened up an account at Coinexx in October and funded with 1 BTC and auto converted to USD and traded with their MT5 platform. I was trading at the max 500:1 leverage and trading forex pairs. I made 4 total deposits:

    1 BTC - String of losses, deposited more funds to increase margin and scale up trading size
    5 BTC - Another string of losses, pretty much lost this amount
    5 BTC - Another string of losses, pretty much lost this amount
    5 BTC - This is where things started to turn around and I made some trades on EURCAD and CADCHF and USDCHF making +16 BTC or so. Now my account is in the six figure range and I am sitting on a profit of 6+ BTC

    I then figured I would test out their withdrawal system and withdrew $10K (2x $5k). Took a couple of days, but worked perfectly, funds received to the BTC wallet. Great. I setup another withdrawal to get my principle out, around 14 BTC. This sat pending over the weekend.

    I then entered some trades on October 15th. With these new trades, I was position sizing them larger due to the account size and margin available. I entered a EURJPY trade at 49 lots, another at 25 lots and then a GBPUSD trade at 26 lots. These ran for nearly 24 hours with no issues. The EURJPY trades were in significant profit and the GBPUSD trade was running at a loss. My withdrawal of around 14 BTC was not processed yet. I was also entering and exiting some trades on BTCUSD throughout the day. Then before the London session, I entered a 40 lot trade on CHFJPY, a 40 lot trade on NZDJPY and a 30 lot trade on NZDUSD. A couple hours later, the trades were all running at a profit. This is what was currently live:

    EURJPY - 49 lots
    EURJPY - 25 lots
    GBPUSD - 26 lots
    CHFJPY - 40 lots
    NZDJPY - 40 lots
    NZDUSD - 30 lots
    ----
    Total lot size of 210

    All running in profit except the GBPUSD trade. At this point, my running profit was around 7 BTC and total account size including the running profit was around 29 BTC. Insane! I was going to start closing down positions, but waited and I went to go make some tea and take my eyes off the charts for a bit. There was plenty of free margin in the account, so I was not concerned. Then the GBP news came out (October 16th) regarding their employment/average earnings numbers. I checked the charts and nothing moved that much, no crazy volatility or spikes, maybe a few pips when the news hit. They were expecting 2.6% and got 2.7%. I opened up MT5 to check my trades and everything was closed out. My account that was 29 BTC in total balance was now at around 3 BTC. Oh no... I figured it was a mistake in their system and contacted live support. The chat rep said:

    "thank you for your patience, as i have received the feedback from my team, due to increased volatility in the market after major news release which lead to the spread widening and low liquidity for such a higher quantity , the positions got stopped out, as the spreads are provided directly from the LPs hence it totally depends on the market volatility, movement and liquidity. Moreover, as per the feedback, the lot size was above 200 lots and the Maximum allowed quantity is 200 lots please have a look on https://coinexx.com/account_type for more information however as we always strive to provide the best client service, hence i have also raised a ticket to my team to do a detailed investigation on your trades and send you the detailed feedback for the same"

    I looked at the charts and the prices in MT5 at which these trades were all closed out. It was an average of a 70 pip spread spike on all pairs, Yens and GBP, causing a margin close out on all positions. No brokers at this time had a 70 pips spread spike on any of these pairs. I call manipulation here. They were not able to further explain or show me anything with their order book. I will say though, I did have 210 lots open when I guess their max was 200 lots - completely my fault. I never knew this and figured that if I went over any limits, the system would just prevent a trade from opening. I didn't know it would spike 70 pips on all trades and lose me over six figures.

    The support rep said she raised a back end ticket to research this. My 14 BTC withdrawal never processed and then was cancelled due to insufficient funds. I was supposed to get a response in 24 hours, but checked in each night with the support team and they kept saying I would get a response in 24 hours. After 5 days or so, I got an email response from them:

    "We have investigated the trades and confirm that the trades got closed out due to margin call stop out. In trading account id – xxxxxx (removed account number), a total of 210 standard lots were opened in currencies with 500X leverage on trading account, which was above the permissible level of 200 lots. At 11.30 server time, there was release of crucial data of GBP employment, which led to spread widening and low liquidity condition in the market. Due to the spread widening and higher position size, stop out triggered in your account which led to the closure of positions."

    I responded back saying that is does not make sense all pairs had a 70 pip spread spike. Yes, maybe possible (but far fetched) with the GBP pair, but the Yen pairs should have still been live. Or if there was a margin call, the trades should have been closed out near where price was trading at the time they were closed out, not 70 pips different. I said I really like the platform and working with their system, but this whole situation is very shady and smells like broker manipulation. I wanted to speak with someone about the whole thing before leaving feedback online for others. 4 followups over the last 19 days and no response. I sent over screenshots from myfxbook showing their live spreads over the last 2 days on all the pairs and the highest recorded spread was 15 pips on GBPUSD. Attached these screenshots as well.

    Anyone else have experience with massive spread spikes like this happening? If you check the charts at the times it shows these trades were all closed out, price was no where near those levels. Very tough, Coinexx was really nice to work with and has a great system, but never though something like this would happen. Is there anything that can be done here?
     

    Attached Files:

  2. Poundtrader

    Poundtrader Private, 1st Class

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    look like you over leverage your account
     
  3. preczau

    preczau Recruit

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    There was $50K+ of free margin available - then there was a 70 pips spread spike on all open trades when news hit, which wiped me out. A 70 pip spread spike during the London session on no surprise news is very weird - no other broker had this nor was it listed in their myfxbook spread tracking
     
  4. FxMaster

    FxMaster Lt. Colonel

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    Did you talk with them about this yet, if yes then what reply you have received from them so far?
     
  5. Poundtrader

    Poundtrader Private, 1st Class

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    yes please keep us updated on this issue
     
  6. preczau

    preczau Recruit

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    This is what they sent after live chat said they were going to do a search into the issue:

    Hope you are doing well!

    This is in respect to an enquiry you made on the website live chat concerning stop out triggered in trading account id 904746.

    We have investigated the trades and confirm that the trades got closed out due to margin call stop out. In trading account id – 904746, a total of 210 standard lots were opened in currencies with 500X leverage on trading account, which was above the permissible level of 200 lots. At 11.30 server time, there was release of crucial data of GBP employment, which led to spread widening and low liquidity condition in the market. Due to the spread widening and higher position size, stop out triggered in your account which led to the closure of positions.

    Feel free to get in touch should you require any further information; we would love to help you out with it!

    Cheers!
    S.Bennett
    Coinexx Support!

    This is what I responded with:

    I understand your explanation, but it does not make sense to me. Why did the spread jump 70 pips on all pairs at this time and stop me out of everything, not just the GBP pairs? The yen trades and the NZDUSD were all running in profit at the time, but they were closed out for large losses as well.

    I trade with other brokers and when the news announcement happened, no brokers has 70+ pip spread spikes on any pairs, including the GBP pairs. I had these exact trades mirrored on Oanda and Forex.com and still had the trades live and running. No spread spikes there.

    I feel like this was manipulation by Coinexx due to the large account size and large running profit at the time ($50K). Normally Coinexx has the tightest spreads and best execution, so this looks like just manipulation.

    Attached images of the spreads on Coinexx - the max spread spikes were 15 pips or so which would have still kept all the trades live. Something does not make sense or match up here.

    I want to trade more with Coinexx and move my full trading portfolio over to you, but this 70+ pip spread spike is terrible and very shady looking. I trade investor accounts and mirrored accounts, so I can bring a lot of volume to Coinexx and money, but you need to make things right with what happened on the stop out issue. I am willing to take a loss on the GBP trade, but the yen trades and the NZDUSD trade should have been closed out at the worst for break even or at some profit. My account should not be sitting at a $76K loss right now. There was no news announcement or lack of liquidity, this was at normal time during the peak of the trading session.

    Please help me and work with me on this issue so I can refer more clients to Coinexx and give you more money. I would hate to leave bad reviews and say it was broker manipulation because that is honestly what this looks like right now.

    ----

    Your information has been passed on to the respective department for the review and you will receive the feedback within 24 working hours for sure.

    Regards,
    S Bennett
    Coinexx Team!

    October 23rd - That was the last I heard from them after 4 followups.
     
  7. FxMaster

    FxMaster Lt. Colonel

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    Nothing after your respnse so far?
     
  8. preczau

    preczau Recruit

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    Nothing - I submitted a support ticket online at the same time I sent the above email - no response from either
     
  9. Coinexx Support

    Coinexx Support Recruit

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    Hi Preczau!

    Before we offer an explanation, we’d also like share with the community here that you are still trading, depositing funds and withdrawing profits without any issues with us. It just seems that you are not satisfied with the explanation that our support team provided regarding the matter being discussed here.

    However, we'd like to re-emphasize that your positions were closed after your trading account margined out due to overleveraging during GBP employment data time. You were trading 210 lots with 500X during GBP news time. And as the spreads widened all your positions stopped out.

    Before delving into details, kindly note that the spread spike was not 70 pips across all pairs. Stating that it was so, seems simply an attempt to make it look like our fault. You cited by attaching screenshots from myfxbook that while the spread spike was 15 pips in GBPUSD, the pair actually experienced a 70 pips wide spread leading to your losses.

    Please note that the charts/spreads that you are referring to only gives the best ask and bid prices of a particular pair. They are not necessarily the exact precise representation of the movement in the pair on that particular day. During news time, the actual execution price can be lower or higher that what we see as ask/bid prices on the charts, due to unexpected volatility & low liquidity in the market.

    The spreads that Coinexx offers are direct quotes of what we get from our liquidity providers. And at significant news events, spreads can widen. And in your case, all your trades were executed at the best aggregated prices that were available during that time, which may or not necessarily be in your favor. We openly caution our clients that spreads tend to widen during news time. Therefore, they need to be careful while entering trades and using leverage.

    We further discussed this situation with our LPs and they also explained that news time, volatility, high leverage and bigger lot sizes led all your positions being margined out. Please note that if leverage can magnify your gains, it can magnify your losses as well. Therefore, leverage should always be used cautiously and wisely.

    Additionally, we'd like to clarify that we process withdrawals within 48 working hours and if weekend falls in between, we do not count those two days in the stipulated time offered for withdrawals. And your 14BTC withdrawal was denied as your account had insufficient funds by the time, accounts team queued it up for processing. The account did not have free margin amounting to 14 BTC, first because you had couple of open trades in your account and second because you had incurred losses in your trading account there on. Coinexx can only process withdrawal of the funds that are "available" not the "amount" the client requests. Once we receive the withdrawal request, we verify how much free margin available in the account and then accordingly proceed forward with request.

    And we are sure you will also acknowledge that withdrawals were never a problem before this incident and they still aren’t now. However, if you still choose to irrationally lie on a public forum, we will be forced to refund all your balance restricting your ability to open an account with us again in future.

    We always strives to be transparent & honest and aim to offer the best trading conditions to all our clients . You can reach out to us anytime and we'll be glad to help.
     
  10. oscarra

    oscarra 2nd Lieutenant

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    so far all we see is a typical House Call, referring to old fashion Bucket Shops practices
    ….a non regulated broker LP providing x500 leverage, of course that’s not a lie

    preczeau can you provide some further evidence as price feed from different sources, brokers…
    we don’t want to be unfair here, do we :)
     

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