Dear, today we are going to talk about a controversial issue, the participation of Big Banks in the forex market.
Everyone knows the importance of Big Banks in the forex market with the motto of liquidity agents, that is, they use this speech to ensure that positions are liquidated immediately, making the forex market the most liquid market in the world.
Many people feel uncomfortable when they learn that the position they closed, whether in gain or loss, was not actually for another trade, but for a Big Bank, with the argument of being the liquidity agent.
As a trader this raises a question:
Who is our opponent?
Make no mistake, our opponent is not another trader, our opponent is always Big Banks.
This changes the perspectives established so far, knowing your opponent is essential.
Make no mistake our opponents are the Big Banks, here I am listing some:
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Deutsche Bank
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Citi
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JP Morgan Chase
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HSBC
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Possibly Some China
Let's understand this dynamic better:
You open a trade, be it long or short, okay?
Not quite, actually think of it as a game, where the Big Banks let you keep playing, long or short, winning and losing, but you're having fun, and Big Bank makes you happy playing, and having fun.
But note that Big Bank always knows which side you are on, be it long or short, Big Bank always knows your position, so the Big Banks know where the money is, and you can be sure, one time they'll come, that's free money for the Big Banks.
But everyone is happy, they continue to play, one day they know of a major event on the economic calendar, and more cautious traders close their positions to wait for such an event to pass, and surprisingly, the expected high volatility does not happen. And so everyone happily goes back to playing.
One day the Big Banks assess that there is a lot of money in Long (70%) and together decide a quick attack in short (30%), on all long traders with open positions, with no apparent event in the economic calendar, many traders long suffered a stop loss, and lost little, other long traders without a stop loss lost everything. The next day it appears only in the news as high volatility in the markets, nervous markets, and nothing else.
Everyone wonders, guys what happened?
Only the annoyance remains, in fact, the Big Banks don't care about you, they won't communicate to the press, of course, they won't say, there was a lot of money long. and we went to get it, see this is free money for the Big Banks.
I know that for novice traders, it seems like a conspiracy, but I have been operating the market since 2008, yes that was the year that the economy collapsed, but I will tell you what happened to EURCHF in 2015.
In the chart below, you have EURCHF D1, in the period from 10 October 2014 to 12 January 2015, note that the Central Bank of Switzerland had established support at 1.20 would never decline below that amount.
Now notice in the graph below what happened on January 16, 2015.
There were approximately 34,000 pips, I remember that at that time the broker Alpari UK, simply declared insolvency, followed by several other brokers, if you did not see this case, at this moment you must be asking yourself, how was that possible?
During the Now York overnight, the Central Bank of Switzerland held a meeting and announced that it would withdraw resistance, and the result was general panic, precisely because people were buying close to 1.20 knowing that the Central Bank of Switzerland would not let the price drop below 1.20, but one day the Central Bank of Switzerland simply gave up buying at 1.20, and in just one stroke, it took thousands of traders, and brokers into bankruptcy.
Now, note that both the Central Bank of Switzerland, as well as the other Big Banks mentioned above, know exactly our positions, so when I developed my strategy presented at Maryland FX, I took care to hide my positions, through an advanced strategy, known to us, trade circles with extensive experience.
Imagine that you are now a Big Bank and see the image below, where is the money?
Understand that the Big Banks are also seeing which side the money is on, it is a matter of time for them to act, and take their money for free. This does not mean that you have to trade against or in favor of the trend, but note that your positions are always observed.
Some traders know how to hide, or rather confuse the Big Banks, so that it is less obvious for them to track open positions, such as Maryland FX. But on the other hand, there are people with more limited knowledge, in which case things are very exposed.
Just as an example, a popular signal provider on the MQL5 site recently experienced problems, note that it only operates EURUSD, this is a weak point, it should operate with more pairs to make it difficult to read the Big Banks, about his positions. But he was exposed not only for being limited to the number of pairs, but also for being too innocent, note that he opened a long position on September 22, and left a stop loss 2000 pips, and stayed at Drawdown for thirteen days, suffering all sorts of criticisms on his page, and worse the take profit of 264 pip, in short if he suffers only one stop loss, he loses approximately 7 wins. But he is popular, and he says he has a magic indicator, of course every trader with good judgment knows that if such a tool existed it would probably be in the hands of a Big Bank, and not in a signal provider on the MQL5 website, and in this case unfortunately it does not help. wish him luck, it's just a matter of time for him to lose. All this time with open positions, it is as if he is dancing on the high seas in front of a shark, the result cannot be good.
Dear, in short, our great adversary is not the traders who simply operate in the most different ways, but the Big Banks, and the Central Banks of each country, where regulations have been raised, always taking into account profitable conveniences.
If you are interested in getting to know my work better, where I developed a strategy to hide in a simple way the reading that Big Banks click here.
We are currently over 1000 trades in just 8 weeks, I hope you enjoy the work, and I wish you all good trades.
So don’t hesitate… Join Me Here
