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The dark side of forex markets

viiveknaiir (viiveknaiir)
Feb 22 at 09:11
3 ieraksti
Forex trading has garnered a lot of attention across the globe in the last decade. Thanks to the internet & technological advancements that has made it possible for retail traders to participate in one of the world’s largest businesses.

When you are new to forex trading, you are easily lost in the vast ocean of trading related content, strategies, indicators & trading gurus that claim to have the holy grail system to make it big in the forex trading world. But within no time you start realizing its not all that. You get this feeling that there must be more to it rather than relying on certain indicators & strategies. A few years back that was exactly what my mind was telling me. Failing strategies & losing my hard earned savings wasn’t an easy phase. But I had made up mind. I wasn't ready to let go all of that just like that. I wanted to know the why’s and how’s. That is how my trading journey began, but this time on a serious note.

To begin with I decided to join a forex brokerage firm to understand what really happens on the other side of the forex markets. I was lucky enough to get a job in one of the biggest forex brokerages back then. Although my role was that of a sales agent, it didn’t take me long to work in a department that dealt more closely with client trades.

I still remember the day when I first heard the word ‘trading syndicate’. That’s the day I realized the existence of a trading syndicate or group of big forex market players that actually manipulated (although not the right word) the markets to ensure that the retail traders lost money. And they are not doing anything wrong. Its a business. For someone to make money, someone has to lose in this markets. The big market players however, like the big financial institutions, market makers & brokers usually had infinite pockets to actually make the markets move the way they wished. So how does this trading syndicate function.

The trading syndicate terms the rest of the traders of the world as ‘herd’. The reason because the herd always acts in group, literally like a herd. The herd (retail traders) are not well versed with the forex market mechanisms & the trading syndicate is aware of that. They are also aware of the fact that the herd usually believes totally on the support, resistance, Fibonacci & other indications given out by indicators. Now the trading syndicate already know what the herd is looking for, they are already aware of what they need to do to fool these retail traders to enter into wrong positions.

A very simple example, if lets the say the trading syndicate wants to buy a certain instrument, they would never buy it right away at the current market price. They follow a certain pattern and rules. One of them being ‘buy low — sell high’. So to buy something they will first make sure that the instrument is trading at the lowest possible price to buy it at the lowest. They do this by pushing the prices down by selling the instrument (although they want to buy). This selling bring out the rest of the sellers to join the selling. Now if the news for that instrument is bad, this calls for more selling, automatically pushing the prices more down. Its into this down move that the trading syndicate starts buying. But guess what when the retail normal traders or herd see the markets fall, they do exactly opposite of what the big traders do. The herd sells, the trading syndicate buys. This process goes on for a while until there are no more sellers in the market. This is when the trading syndicate starts buying, and real buying. Prices start to shoot up, and the herd that was selling, is now in a loss. This is just one part of their campaign.

Trading is a business, not a casino. As a trader, you are a businessman, not a gambler.
bax699 (bax699)
Feb 22 at 18:36
21 ieraksti
Very true sir, all we can do is try to go along with the ride they create. Risk management is key for little retail traders

LyudmilLukanov
Feb 22 at 23:05
461 ieraksti
bax699 posted:
Very true sir, all we can do is try to go along with the ride they create. Risk management is key for little retail traders


I think risk management is key to success for all kind of traders in the market.

morkaldish
Mar 03 at 08:09
9 ieraksti
Truly said! Forex trading has given the world a way of making money. You can trade the way you want without having to worry about the rest of the world.

ddarko3
Mar 03 at 12:23
55 ieraksti
bax699 posted:
Very true sir, all we can do is try to go along with the ride they create. Risk management is key for little retail traders

Along with money management which I believe are both very good for economically trading

DanielGlaus
Mar 07 at 10:25
26 ieraksti
It is best to set a goal and trade. It is possible to earn profit by trading according to discipline.

LeviSievwright5
Mar 09 at 14:58
298 ieraksti
viiveknaiir posted:
Forex trading has garnered a lot of attention across the globe in the last decade. Thanks to the internet & technological advancements that has made it possible for retail traders to participate in one of the world’s largest businesses.

When you are new to forex trading, you are easily lost in the vast ocean of trading related content, strategies, indicators & trading gurus that claim to have the holy grail system to make it big in the forex trading world. But within no time you start realizing its not all that. You get this feeling that there must be more to it rather than relying on certain indicators & strategies. A few years back that was exactly what my mind was telling me. Failing strategies & losing my hard earned savings wasn’t an easy phase. But I had made up mind. I wasn't ready to let go all of that just like that. I wanted to know the why’s and how’s. That is how my trading journey began, but this time on a serious note.

To begin with I decided to join a forex brokerage firm to understand what really happens on the other side of the forex markets. I was lucky enough to get a job in one of the biggest forex brokerages back then. Although my role was that of a sales agent, it didn’t take me long to work in a department that dealt more closely with client trades.

I still remember the day when I first heard the word ‘trading syndicate’. That’s the day I realized the existence of a trading syndicate or group of big forex market players that actually manipulated (although not the right word) the markets to ensure that the retail traders lost money. And they are not doing anything wrong. Its a business. For someone to make money, someone has to lose in this markets. The big market players however, like the big financial institutions, market makers & brokers usually had infinite pockets to actually make the markets move the way they wished. So how does this trading syndicate function.

The trading syndicate terms the rest of the traders of the world as ‘herd’. The reason because the herd always acts in group, literally like a herd. The herd (retail traders) are not well versed with the forex market mechanisms & the trading syndicate is aware of that. They are also aware of the fact that the herd usually believes totally on the support, resistance, Fibonacci & other indications given out by indicators. Now the trading syndicate already know what the herd is looking for, they are already aware of what they need to do to fool these retail traders to enter into wrong positions.

A very simple example, if lets the say the trading syndicate wants to buy a certain instrument, they would never buy it right away at the current market price. They follow a certain pattern and rules. One of them being ‘buy low — sell high’. So to buy something they will first make sure that the instrument is trading at the lowest possible price to buy it at the lowest. They do this by pushing the prices down by selling the instrument (although they want to buy). This selling bring out the rest of the sellers to join the selling. Now if the news for that instrument is bad, this calls for more selling, automatically pushing the prices more down. Its into this down move that the trading syndicate starts buying. But guess what when the retail normal traders or herd see the markets fall, they do exactly opposite of what the big traders do. The herd sells, the trading syndicate buys. This process goes on for a while until there are no more sellers in the market. This is when the trading syndicate starts buying, and real buying. Prices start to shoot up, and the herd that was selling, is now in a loss. This is just one part of their campaign.

Yes, you are right. To trade, you must first learn to manage risk.

SteveHanks
Apr 30 at 18:29
235 ieraksti
DanielGlaus posted:
It is best to set a goal and trade. It is possible to earn profit by trading according to discipline.

You are absolutely right. Without setting a goal, it will be very difficult to make money from this market.

LukeRachel
May 06 at 00:18
210 ieraksti
If I can manage the risk, it is possible to gain some profit in the trade. Successful traders always manage risk and trade.

raftingtask
May 14 at 11:17
4 ieraksti
That is right and you have made some compelling points here.

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