EUR/USD Chart Analysis

Price manipulation in the Forex market - Observation in the Euro/US Dollar

Price manipulation in the Forex market - Observation in the Euro/US Dollar

A very important aspect in Trading Forex in my opinion is that price is most often pushed/ (particular at news release) to slightly penetrate or break Support/Resistance zones (for example recent Highs/Lows/Pivot Points or in general where stops are anticipated) to trigger the stops and often reversing after completing the stop run and targeting the opposite zone where stops are anticipated (for example the stops of the fooled breakout traders). The manipulation aims to catch the stops and to fool breakout traders at Support and Resistance or striking levels for example highs/lows and psychological numbers. This allows market manipulators to position themselves against the mainstream trader (setup). This may explain why most of the traders and mainstream trading strategies fail and will fail in the future.

Thus, an efficient way to successfully trade forex might be to accept and understand the way of market manipulation. Hence, it becomes important to analyze the intention of the manipulator, which is to catch stops of the mainstream traders and to fool them into bad mainstream setups by moving the market in the opposite direction targeting the mainstream stop zone e.g. at popular Support/ Resistance. Mainstream setups only work out when they are related to the manipulator's strategy. So it often falls back to the manipulator's trading strategy but if the mainstream trading strategy will work out, which probably is statistically insignificant , then this often reinforces the hype about the mainstream trading strategies, which are mostly fooling traders into bad setups and give manipulators the advantage to know how most of the traders trade, including the location of their stop/limit order positions.

Furthermore, there are many algorithmic trading programs of the market manipulators, which are automatically employed on the short term time frames like 1 min, 5 min,hourly..., programmed to use their market power to move market against the mainstream traders to shift the odds of successfully trading forex heavily against them.

In general, I would argue that stop running on at least the shorter time frames should be accepted by traders and that it should play an important part in a traders day and swing trading strategy to successfully trade forex. A wise alternativae would be to stay away from forex.

More about forex manipulation at:

EUR/USD Technical Chart Analysis/ Patterns Euro US Dollar Day Trading Signals/ Setups Forex Market: Price Manipulation in Forex
 
Faked Trading Signals and Stop Runs byin the Forex Market by Manipulators

Popular Chart Levels misused for faked Trading Signals and Stop Runs by Manipulators

Some Popular Trading Levels:

Important Highs/ Lows
Round Numbers
Pivot Points

Market often comes back or gravitates around these popular chart levels and frequently penetrates them to trigger mainstream trading signals and to run for stops.

Be careful with these mainstream trading strategies. Moreover watch out for pure stop runs at these chart levels, which can lead to a strong market turn around. In general, the first breakout is often a false one.

Often a minor false price breakout at Highs/ Lows, Round Numbers and Pivot Points come with the first test of these chart levels to trigger close-by breakout orders and stop orders. The retracement to catch some stops of the breakout traders often gives the faked impression that the popular chart level holds as Support/ Resistance, thus encouraging mainstream traders to position accordingly. However, market often goes for a second test of the popular chart levels to clear the stop orders above/ below important chart levels before either retracing back or breaking through the level targeting the next one.

Moreover, a clean break through a striking trading level without an immediate price retest is very seldom and if so then the chance of a retest in near future is likely to catch stop orders of the breakout traders and to minimize the chance of an easy trade with a small stop lose at important price levels although the reiterating stop triggering process at striking chart levels would suggest this to happen more often in the absence of any market price manipulation.

In general, market price goes there where the stop loss orders are anticipated.

Read more:

Overview: Market Price Manipulation in Forex
 
I generally agree, however, this is not the case ALL the time. But, in general, if you only pay attention to the short term trade, you can be hurt. Day trading, unless you have plenty of money, is VERY dangerous.
 
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