I don't know how fxcm handles orderflow, but the usual practice is that most of the small fx brokers, act as market makers, and try to profit off the spread by making retail pay wider spreads then what is available on the actual interbank market.
This is the price retail pays to speculate using small amounts of funds and leverage. Most of all retail accounts end up loosing in the end secondary to:
1) immense leverage
2) volatility
3) small stops/large stops
Since these fx brokers use a 'representative market', if your making money on orders that last less then 1 minute, where round turn in/out, your most likely taking it away from the broker. Meaning if your scalping, and instinctually selling minute to minute waves, and buying minute to minute valleys, the broker can't offset fast enough for a profit, since initial orderflow will get matched with inhouse opposing orders first, and then offset in interbank.
So there is a delay when this representative market is constructed. In volatile markets and it becomes even harder to offset this risk. Your order doesn't get sent to interbank in most instances.
You can also get a bloomberg API, and game these Fx brokers, the API, quickly feeds the number of a popular report, and a deviation from the norm if its larger enough gets acted upon within milliseconds. Before the fx broker can represent the market in time. And people walk away with 20-40 pips or more within milliseconds. These fx brokers basically loose money to a faster system that arbs them, and cry fowl. They will confiscate profits, and close accounts. This problem could be avoided if they stopped being market makers. The stories abound. In Fx its the wild wild west. CME is working on a more refined FX system. So when it comes out, lot of these small brokers will be out.
