Is my broker trustworthy? (FXCM)

Quote from mamba315:

This really confused me since, according to the CMS charts on my phone, the price never came close to my stop.

On the FXCM chart there was a very sharp 25-30 pip spike downward to 1.5612 at 18:37EST that did NOT show up on the CMS charts at all. So I called FXCM and talked to customer service.
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I have seen this with oanda. It happens most of the time when I would use a stop. I stopped trading with them because they would purposely spike it up or down just to hit my stops. If I trade without stops, no spikes and I was making a profit.
 
Quote from mamba315:



What would be the smartest way to contest the trade with FXCM? In the FXCM reviews on this site, one person got FXCM to refund their trade after they proved that their stop was not hit on Bloomberg after FXCM had claimed that it was. Similar situation to mine. FXCM also claimed that the price was hit on Bloomberg, but I don't know how to get access to that feed.

At this point I can't stay with FXCM. I feel like they're scammed me and I'm not about to give them a second chance. My only solace at this point was that it was a small position.
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I don't have access to a Bloomberg terminal but I bet there's someone on here who has and would screenshot the relevant chart for you, maybe make a post with 'Bloomberg Terminal User Needed' in the subject line? It may be a long shot but how about calling/emailing Bloomberg and asking them to help you out with a chart for that day (telephone numbers/emails on their website).

I'm surprised FXCM take any notice of that data though, they have their own sources for pricing and it's easy for them to check whether the spike and quote was erroneous (bad data) or not. I suppose you could go the official route and raise a complaint but at the end of the day they dictate what prices they are prepared to trade at regardless of what anyone else is quoting, I honestly don't think you would win, it would just make you even more pissed!

Believe me I know how you feel as a similar thing happened to me with CMC. Despite appealing to their better judgment and pointing out that reimbursing the minor loss would make more business sense in the long run than to lose me as a client it didn't make any difference. I kept the account live but didn't trade it and drew out the bulk of funds. In order to continue trading I had to find another broker, fund the account, and learn the platform. Although I felt a bit stupid going through all that over just a few bucks it became a matter of principle. After about 6 months I got a call out of the blue from a sales rep asking if I would like to re-fund my account and as an incentive they would credit the account with $100 (the original loss was for less than that!).

I won in the end but in retrospect I probably would have been better off accepting the original loss because the new broker was worse and I lost about a week's trading while shuffling funds around and opening the account, it turned out to be a typical case of cutting off my nose....:)

I would say if you've been happy with them up until now, and seeing as the loss was relatively small, it may be wiser and less work and expense to give them the benefit of the doubt and one last chance. Don't get mad, get even!
 
This will happen in all bucketshops.

They set the quotes they want, and you just have to accept it, be them fair or not.

They could have even quoted the Euro at 1.30, 1.20, 1.00, hell even 0.50 Euros PER DOLLAR, whatever is needed to run your stops.

In the words of wisdom from the NFA Forex Brochure:
“There is no central marketplace. Unlike regulated futures exchanges, in the retail off-exchange forex market there is no central marketplace with many buyers and sellers. The forex dealer determines the execution price, so you are relying on the dealer’s integrity for a fair price.”

Brokers often don't run stops beyond 30 or even 50 pips, because it would be very obvious that they manipulated the quotes, but they can do it if they want to. Specially if they are about to go bankrupt, so they just won't mind being discredited.

SWITCH TO FUTURES ASAP, or else keep losing money.
You have been warned.
 
Quote from jaronimo:

I have seen this with oanda. It happens most of the time when I would use a stop. I stopped trading with them because they would purposely spike it up or down just to hit my stops. If I trade without stops, no spikes and I was making a profit.
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Are you positive Oanda actually spiked down the price? Are you sure it wasn't from them just widening the bid/ask spread?

Oanda widens spreads for various reasons (ie weekend, illiquidity, news releases, etc) and if your stop is within that spread you're toast. Doesn't necessarily mean they were gunning for your stops or anything.

The give-away to this happening is when you don't see the stop price as being hit on the chart...this means it was due to widening stops.

Make sure you keep your stops wide enough to account for this sort of thing.
 
Quote from Reaver:

Are you positive Oanda actually spiked down the price? Are you sure it wasn't from them just widening the bid/ask spread?

Oanda widens spreads for various reasons (ie weekend, illiquidity, news releases, etc) and if your stop is within that spread you're toast. Doesn't necessarily mean they were gunning for your stops or anything.

The give-away to this happening is when you don't see the stop price as being hit on the chart...this means it was due to widening stops.

Make sure you keep your stops wide enough to account for this sort of thing.
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I am as positive as I can be without them actually telling me they spiked it to hit my stop. The first time or two I just thought it was a fluke that a steady sideways trend had one hard spike exactly to my stop.

Then it happened a third time and I thought "they are purposely hitting my stops". So I moved them further away. About 2 weeks later, same thing, steady sideways trend and then one 45 pip spike right to my stop.

I have not had any issues like that with futures. In the futures market my biggest trade is nothing for them.
 
Quote from jaronimo:

I am as positive as I can be without them actually telling me they spiked it to hit my stop. The first time or two I just thought it was a fluke that a steady sideways trend had one hard spike exactly to my stop.

Then it happened a third time and I thought "they are purposely hitting my stops". So I moved them further away. About 2 weeks later, same thing, steady sideways trend and then one 45 pip spike right to my stop.

I have not had any issues like that with futures. In the futures market my biggest trade is nothing for them.
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45 pip spike to take out your stop, are you sure :eek:

I've heard of 3 or 4 but 45, if it's as consistent as you say it is that's a great opportunity to hit them for some serious cash, I'm surprised if Oanda leave themselves open like that.
 
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