Market Maker with FXCM MINIREAL Account???

Astro409

Recruit
Messages
9
Is it just me or does anyone else feel like a market maker when the amount in their account is little(less than $100 USD), at the time i've lost about 70% of learning investment? This is not my 1st time asking myself that question. After reading a few fx notes, looking at a four hour chart for the EUR/USD, followed by a 5 minute and then a 1 minute chart today I opened a 1 lot short position on the EUR/USD at 10:58am eastern time. The market started to go in the opposite direction of my position. After seeing my indicators(CHO,MACD and Stochastic Slow) line up, AGAIN, I opened a second short position at 11:15am to try to capitalize on a potential reversal. The EUR/USD was bullish sort of strong(in my opinion) for the next 30 minutes and seemed to reach some sort of resistance around 11:45am but I was over 30 pips negative already. My indicators kept giving me signs of a reversal but for the next hours(almost 5 hours) so I kept my short position opened to see if I would gain some pips back but the market went almost sideways and still in a slight bullish trend. I had lost an additional 10 pips by 15:54 when I decided to close my positions.

I closed my position more than anything to try something. I understood from my 1 minute indicators(CHO,MACD and Stochastic Slow) that the price was going to go up so I closed my short position and opened a 2 lot long position on the same EUR/USD currency pair about a minute later(it shows 15:56) when things seemed to confirm my opinion. Well, by the art of magic, bad calculations, bad luck or whatever you want to call it the market turned and started going bearish as soon as I entered my new long position. At 16:22 I closed the long position 11 pips negative feeling sick and mad.

Please keep in mind that I am not mad about LOSING the money given that i'm losing .11 cents per pip. I'm mad that a transaction so small should go undetected, in my opinion, ALMOST like with the DEMO account. However, it appears that its making a difference in the FXCM market. I only lost USD $10.21.

53874022 EUR/USD 1,000 2/19/13 10:58 AM 1.33570
2/19/13 3:54 PM 1.33961 -3.91

53874596 EUR/USD 1,000 2/19/13 11:15 AM 1.33571
2/19/13 3:54 PM 1.33961 -3.90

53881292 EUR/USD 2,000 2/19/13 3:56 PM 1.33966
2/19/13 4:22 PM 1.33846 -2.40
 
Check the price action at the same time on demo accounts at a couple of other regulated brokers. I'll wager that price action at those mirrors what you saw within a few pips.

Sometimes, it seems like the broker or even the market itself is reacting to wreck your trades, but it's unlikely that the prices being shown to tens of thousands of traders would be "adjusted" so shift the whole market from bullish to bearish just to cause you to lose money.

Some bad brokers are much more likely to use software that causes momentary spikes of a few pips to grab stops or to give you a couple pips slippage on opening or closing. Creating a completely artificial set of prices while you have a trade open for hours would be too easy to detect and prove.
 
Am I being paranoid??? How can I tell how much volume there is in a pair when I enter a trade? Yesterday I figured I put to work my NEW knowledge about Bollinger Bands. I went short early in the morning to take advantage of the volume of the London market on the EUR/GBP. I was following the trend and it started to go against me, By 10 am I was down over 60 pips so I reversed my position to long. Almost instantly the market turned, yes, against me again. I let it run and closed my position again after 11 am. Early this morning I added another $50 usd to my account and took a look at possible scalping positions with Bollinger Bands. I opened a long AUD/USD and short CAD/CHF. You guessed it, they both went against me. I'm still in the trade and i'm recovering but this is too weird. I know I really know that FXCM is too big to be scamming especially on an account this size. Here are a few pictures both with my cell phone and snapshots. I have a bunch but here are a few pictures. I REALLY REALLY REALLY want to be wrong.
marketmaker_zps615ea559.png

marketmaker4_zps754220c7.png

march13CADCHF4am_zpseef0d208.png

march13AUDUSD4am_zps898dd027.png

20130312_101423_zpsd2696ed8.jpg

20130312_101521_zps86e6d5bd.jpg

20130312_101915_zpsa7523b24.jpg

20130312_103700_zpsb7036977.jpg

20130312_103713_zpsa9f2b3b5.jpg
 

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Is it just me or does anyone else feel like a market maker when the amount in their account is little(less than $100 USD), at the time i've lost about 70% of learning investment? This is not my 1st time asking myself that question. After reading a few fx notes, looking at a four hour chart for the EUR/USD, followed by a 5 minute and then a 1 minute chart today I opened a 1 lot short position on the EUR/USD at 10:58am eastern time. The market started to go in the opposite direction of my position. After seeing my indicators(CHO,MACD and Stochastic Slow) line up, AGAIN, I opened a second short position at 11:15am to try to capitalize on a potential reversal. The EUR/USD was bullish sort of strong(in my opinion) for the next 30 minutes and seemed to reach some sort of resistance around 11:45am but I was over 30 pips negative already. My indicators kept giving me signs of a reversal but for the next hours(almost 5 hours) so I kept my short position opened to see if I would gain some pips back but the market went almost sideways and still in a slight bullish trend. I had lost an additional 10 pips by 15:54 when I decided to close my positions.

I closed my position more than anything to try something. I understood from my 1 minute indicators(CHO,MACD and Stochastic Slow) that the price was going to go up so I closed my short position and opened a 2 lot long position on the same EUR/USD currency pair about a minute later(it shows 15:56) when things seemed to confirm my opinion. Well, by the art of magic, bad calculations, bad luck or whatever you want to call it the market turned and started going bearish as soon as I entered my new long position. At 16:22 I closed the long position 11 pips negative feeling sick and mad.

Please keep in mind that I am not mad about LOSING the money given that i'm losing .11 cents per pip. I'm mad that a transaction so small should go undetected, in my opinion, ALMOST like with the DEMO account. However, it appears that its making a difference in the FXCM market. I only lost USD $10.21.

53874022 EUR/USD 1,000 2/19/13 10:58 AM 1.33570
2/19/13 3:54 PM 1.33961 -3.91

53874596 EUR/USD 1,000 2/19/13 11:15 AM 1.33571
2/19/13 3:54 PM 1.33961 -3.90

53881292 EUR/USD 2,000 2/19/13 3:56 PM 1.33966
2/19/13 4:22 PM 1.33846 -2.40

Am I being paranoid??? How can I tell how much volume there is in a pair when I enter a trade? Yesterday I figured I put to work my NEW knowledge about Bollinger Bands. I went short early in the morning to take advantage of the volume of the London market on the EUR/GBP. I was following the trend and it started to go against me, By 10 am I was down over 60 pips so I reversed my position to long. Almost instantly the market turned, yes, against me again. I let it run and closed my position again after 11 am. Early this morning I added another $50 usd to my account and took a look at possible scalping positions with Bollinger Bands. I opened a long AUD/USD and short CAD/CHF. You guessed it, they both went against me. I'm still in the trade and i'm recovering but this is too weird. I know I really know that FXCM is too big to be scamming especially on an account this size. Here are a few pictures both with my cell phone and snapshots. I have a bunch but here are a few pictures. I REALLY REALLY REALLY want to be wrong.
marketmaker_zps615ea559.png

marketmaker4_zps754220c7.png

march13CADCHF4am_zpseef0d208.png

march13AUDUSD4am_zps898dd027.png

20130312_101423_zpsd2696ed8.jpg

20130312_101521_zps86e6d5bd.jpg

20130312_101915_zpsa7523b24.jpg

20130312_103700_zpsb7036977.jpg

20130312_103713_zpsa9f2b3b5.jpg

Hi Astro,

As Pharaoh pointed out in his post, you can verify the prices on your charts by comparing them to an independent source. That will confirm for you that they are valid. FXCM uses a No Dealing Desk forex execution model where 10+ liquidity providers stream us competing quotes. We take the best bid price and the best ask price being quoted to us at any given moment in time, and those determine the sell and buy price you see on your platform. To make our profit we just add a fixed pip markup to the price which acts as a commission. That means we make our money based on your trading volume, not your losses. We make the same amount executing your orders, whether you win or lose. In fact, it's better for us that you make money, because it probably means you will trade more.

I'm sorry to hear you've had a bumpy start to your trading. (At least I'm assuming you are new, because you mentioned putting your new knowledge about Bollinger Bands to use.) We've all had days where it seems like try as we might, we end up buying at the top or selling at the bottom. It can happen even with the best of strategies sometimes. Trading is about odds, not certainties. The best you can do is place a trade where the odds are in your favor. It doesn't mean that specific trade will definitely be a winner, but over the long term, if you place enough trades where the odds are in your favor and don't risk too big a percentage of your equity on any one trade, you have a better chance of coming out ahead overall. In fact, your recent experience may give you a greater appreciation of another indicator that may help you.

It's called the Speculative Sentiment Index (SSI). What's unique about this indicator is that it does not look at price. Instead it measures trader sentiment by comparing the number of long positions in a given currency pair to the number of short positions. A positive SSI value means there are more long positions. A negative value means there are more short positions. An SSI value of 1.22 for AUD/USD means that there are 1.22 long positions for every 1 short position. An SSI value of -1.13 for GBP/USD means that there are 1.13 short positions for every 1 long position. SSI is a contrarian indicator, which means you want to look to do the opposite of what the majority is doing.

ssi_aud-usd_body_Picture_19.png

Past performance is not necessarily indicative of future results.

If the majority of traders are long AUD/USD, that could be signal to sell. If the majority of traders are short GBP/USD, that could be a signal to buy. Below is a graph relating the SSI readings for AUD/USD from today's SSI report on DailyFX.com. Notice how periods where SSI is positive tend to correspond with times when AUD/USD is dropping, and periods where SSI is negative tend to correspond with times when AUD/USD is rising. Again, this does not work all the time, but it is another tool, just like Bollinger Bands.

Good luck and good trading!

Jason
 
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