Get started

Hedgefund

Trading key-levels and how to HEDGE properly (+486 pips)Is it true that the Forex Market is manipulated and controlled by a handful of banks and market makers? If so, how can we identify when they manipulate the forex markets and is it something that requires access to sophisticated tools and secret contacts? Well, let’s begin by getting a few facts straight. Firstly it is true that the forex markets are manipulated and while you don’t need any sophisticated tools or secret contacts to understand how this happens, identifying when it happens is not easy for the majority of retails traders. What most traders fail to appreciate is what the financial markets truly are and how to trade forex properly. The Forex markets is a place where buyers and sellers come together facilitated by brokers and market makers who look to profit by making a commission for each transaction. Just like any other market, buyers and sellers can only come together if there is a middleman facilitating the transaction. This middleman in the case of Forex is the market maker, and their job is simply to match buy and sell orders for the best price possible and earn the most commission that they can on each transaction. How forex works – Buyer & Seller Counterparties Every trade that is executed in the forex markets has to have a buyer and seller and when this takes place then we have a trade. This normally happens in a fraction of a second electronically but in essence, each time you enter a buy trade you are being matched with someone who is happy to enter a sell position and take the opposite side of your trade. If this doesn’t happen then there wouldn’t be a trade. Why is this so important? Because it highlights the problems that large banks have which small traders don’t. Any retail trader is able to place whatever position size they wish into the market without ever fearing slippage or bad fill. Granted slippage may take place during high impact news items such as central bank announcements but on the whole, most of the executed trades are done instantaneously. Now if you’re a retail trader trading 1 standard Lot then you won’t have any problems with being filled at the price you want. Imagine you’re trading 100 Lots or 500 Lots or 1000 lots, these are larger positions to put into the market at any one time and it’s much more difficult to find someone to take the other side of the trade at the exact price and the exact time that you want and therefore might not be filled at a great price. Well, what could you do in such a situation? You have one of three options: Option 1: You could either bite the bullet and get executed at whatever price you are able to get, the only problem here is that you won’t be getting the best price possible for your trade which eats into your profits. Option 2: You could wait for the price to get to the price level you want so that you get the best execution possible and buy or sell at a much more favorable price – this is great but what if the price doesn’t get to the level you want for you to execute your trade? You will either be forced to walk away without making a trade or be forced to take whatever price you can get if doing the trade is absolutely essential Option 3: You force the price to get to the level at which you want to transact by cleverly manipulating other smaller traders to push the market in the direction you want it to go. Once you get the price to the level you want then you can carry out your transaction. How can you do this? By taking massive positions and exercising your muscle. This is similar to when large companies and conglomerates bully smaller businesses out of the market through aggressive competition. Best Options… Which option do market makers and those with large orders take? Option 3. This is how manipulation works in simplicity. The big players who have the money to move the market in the direction they want, do so on a regular basis. What’s more, they have no option but to do this because unless they can manipulate the market then they won’t be able to execute their large orders. Think about it – what causes the price to move up? An imbalance of buy and sell orders such that there are more buy orders than sell orders which means there is more demand for that particular currency pair than there is supply. Conversely, what causes the price to fall – a larger build up of sell orders than buy orders such that supply outstrips demand thereby resulting in price falling. Now if a market maker comes into the market with a massive order to buy a currency, what will happen to the price? It will start to rise. This means that the market maker is bidding the price higher and so forcing himself to keep buying at higher and higher prices until their order is filled. This hardly sounds attractive or even smart for that matter as the market maker is in the business of maximizing their profits. So what is the alternative? The only alternative is to buy or sell in a hidden way without alerting all the other traders as to what is really happening. How does this take place? By buying into selling pressure or selling into buying pressure. In other words, what a market maker will do is do the opposite of what they intend to do in order to push the price to their desired level. What is a market maker? It is a financial intermediary set up with the sole purpose of matching buyers and sellers together to make a commission in the process. So let’s say a large European conglomerate wants to buy out a US company for $10 Billion. It can’t just go to a money exchange bureau or the bank to change that amount of money. Most likely it will go to a currency broker or a large bank who will complete the transaction by going into the money markets via their brokerage arm. Once the market maker receives the order for the transaction, their job is to convert the conglomerate’s money from Euro’s into USD. They will, therefore, be trading the EUR/USD pair and selling Euro’s and buying USD. Since this transaction of selling Euros and buying USD happens instantaneously, what the market maker needs to do is get the highest exchange rate they can for Euros to USD. The way they do this is very important as it affects the amount of commission they stand to make. In this example, it’s in the market maker’s interest to achieve the highest interest rate they can so they do this by driving the exchange rate higher first and then starting to sell the euros against this higher price. They continue to sell just as everyone else is fooled into thinking that price is going to continue higher until eventually they sell all the euros and convert into USD and complete the transaction. What happens now is that since the selling pressure has become stronger than the buying pressure, price starts to fall rapidly and everyone is left scrambling to get out of the trade once they find out that they are wrong. The reason people are left scrambling is that as a result of giving a false signal of the market starting to move up, the market maker manages to entice other traders to start buying heavily. Once the other traders find out that they were wrong in their assessment of market direction, then the main focus becomes to get out of their positions quickly. This is what we call the trap and it happens on a weekly basis in the Forex market. _________________________________________________________________________________________________________________________________________________________________________ No part of this book may be reproduced or used in any manner without written permission of the copyright owners except for the use of quotations in a book review. Any opinions, news, research, analysis, prices, trade discussions, or other information contained on this website are educational in nature and merely provided as a presentation of trading strategies. Commentaries made on this website reflect our own opinions and trading techniques and do not constitute investment advice. All information and material is for educational and entertainment purposes only and is not intended to provide financial advice. *This is not financial advice. I am not a licensed financial advisor. Seek a licensed financial advisor before making any investment decisions. I am not responsible for losses or gains that may or may not occur in the marketplace. Forex carries a high level of risk not suitable for all investors.*
Long
by TayFx
4
Goldman Sacks warns that buybacks are ‘plummeting,’Goldman warns that buybacks are ‘plummeting,’ ending a big source of buying power for the market Corporate buybacks are “plummeting” as companies tighten their purse strings, and it could have a big impact on the market, Goldman Sachs warned in a note to clients. In the second quarter, S&P 500 share buybacks totaled $161 billion, about 18% less than the first quarter, the firm found. The amount spent on buybacks this year is down 17% from a year earlier, although it is on track to be the second highest total on record, Goldman said. The firm anticipates that this trend will continue, saying “early indications suggest second-quarter weakness in buybacks may persist.” For 2019, total buybacks will drop 15% to $710 billion, and in 2020 they see a 5% decline to $675 billion, the firm predicted. Share repurchases have been a key element during this bull market, the longest on record. By repurchasing shares, a company reduces the number of shares outstanding. It can have the effect of boosting the stock price and lifts earnings per share figures. It’s a frequent, but not always popular, move for companies. Some argue that instead of using buybacks, companies should invest more in capital investments. And Washington is taking note. The House Financial Services Committee, for instance, is looking at ways to reform buyback spending laws. All spending is slowing The slowdown in buybacks is part of a larger trend of spending cuts, Goldman found, as trade uncertainty and stalling global growth weigh on the market. Total cash spending fell by 4% year over year in the first half of the year, according to the firm. It anticipates cash spending for the entire year will decline by 6%, making it the sharpest yearly decline since 2009. During the third quarter “CEO confidence plummeted to the lowest level since the Global Financial Crisis,” Goldman said. It cited a recent study from Duke University that found a majority of CFOs expect the U.S. will be in a recession within the next year. “Companies spend less cash when policy uncertainty is high. During August, global economic policy uncertainty registered the highest level in at least 20 years. Historically, growth in aggregate S&P 500 cash spending has been weaker during periods of high policy uncertainty. The combination of an ongoing trade conflict and next year’s US presidential election will likely result in lingering uncertainty,” Goldman’s David Kostin wrote
NYSE:GS
by oussamaelgadoum
JP Morgan unwilling to match SoftBank’s perks to WeWork CEO AdamWeWork but WeDon’tGetPaid. That’s the grim reality J.P. Morgan Chase bankers are facing now that WeWork is close to accepting a deal to sell control of the office-sharing company to SoftBank in a debt and equity package. J.P. Morgan would have been the so-called “lead left” adviser on WeWork’s IPO and lead financier on an associated $6 billion credit facility, two roles that would have brought in millions in fees. J.P. Morgan is also WeWork’s third-largest external shareholder -- client money rather than bank asset capital -- behind SoftBank and Benchmark. Instead, the bank will collect a smaller fee for raising money that WeWork won’t use, according to a person familiar with the matter. In the three weeks since WeWork withdrew its IPO filing, J.P. Morgan has been trying to secure alternative financing to save WeWork, which was set to run out of cash by mid-November CNBC reported last week. The bank has held talks with more than 100 investors to try and pull together a $5 billion debt package — an alternative to SoftBank’s bailout plan. J.P. Morgan has raised the money but won’t overvalue the company by putting in more equity, according to a person familiar with the matter. The bank also refused to add in a tender offer to its bailout package that would give co-founder and ex-CEO Adam Neumann a path to sell more shares, said the person, who asked not to be named because the plan is confidential. Additionally, SoftBank is paying hundreds of millions to Neumann to leave the board of directors, give up his voting shares and support SoftBank’s takeover, according to Axios — something J.P. Morgan was also unwilling to do, the person said. CNBC’s David Faber first reported earlier Monday that WeWork is planning on rejecting J.P. Morgan’s financing plan in favor of SoftBank’s, which combines debt and equity. SoftBank is planning on investing between $1 billion and $3 billion in a tender offer, in addition to accelerating a $1.5 billion equity infusion and $5 billion in debt financing, with other syndicates, people familiar with the matter said. WeWork’s board is likely to meet on Tuesday to finalize details about selling control of the company to SoftBank, said the people, who requested anonymity because the discussions are private. J.P. Morgan CEO Jamie Dimon had worked personally with Neumann on trying to get the company into the public markets. Dimon has made a point of breaking up the Goldman Sachs-Morgan Stanley tech IPO duopoly and has touted his bank’s recent success. “We’ve made huge progress in Silicon Valley,” Dimon said at a roundtable discussion in Silicon Valley last year.
NYSE:JPM
by oussamaelgadoum
GBPJPYhitting demand zone fibonacci support area ________________________________________________________________________________________ Golden Trading Rules: Big movements take time to develop ________________________________________________________________________________________ I'll be happy to read your opinion and ideas, and if you like the idea, please give it a like for support, thanks Remember, we are speculators, not investors ;) Have a profitable day Telegram Contact: t.me Supply And Demand Strategy
Long
by Aidin_Jabarpoor
1
How The BIG BANKS Have Fooled Everybody AGAIN!!! USD/CHFOn Sept 27 everybody was short on USD/CHF. It was pretty clear that the USD/CHF had reached a strong supply zone. But why next day the price went up? The question is, how to read the big banks and big financial institutions? The only answer is price action + volume. It's like the old times, the ticker tape, supply & demand. If there is a strong movement there should be a strong volume to back up the strong movement. If they shout out "buy, buy, buy" but they don't actually register the "buying", that doesn't matter. As you can see that happen yesterday Sept 30. You can see a strong move up, a big green candle, enough to scare and panic the retail trader BUT where is the Volume? The Volume closed below the average. That means that the big banks and big financial institutions were out of the game, they were not buying the moving up, they were someway manipulating the whole "game". No indicator can read that!!! Today the price went all the way up to 1.00156 (which I was short, I'm not bragging, don't get me wrong), to suddenly slumps after "bad manufacturing data". Did they know about the bad news? Probably yes. I've lived enough to know that there is no coincidence in life.
Short
by Gottmann
2
EUR/USD Stopped outSorry for the late post I took this trade late night and got stopped out early this morning I received a signal on the 4 hr chart around 4 pm CST. The red vertical line is my signal to start looking On the 1 hr chart i drew a fib from the most recent high to most recent low before the red vertical line I soon got a entry on the re-tracement back to the 38.2 Fib level for a short position P.S. I am currently offering Forex signals Email me if interested fibtrader90@gmail.com
Short
by FXjoey90