Alpari UK Trading Games

[rsmereka]

Here is an interesting game or mistake on the part of Alpari UK. Keep in mind that this just happened on my demo account. If it was my live account, I would be screaming bloody redrum . Use my demo statement here to follow along. The trade is ticket 46852704 on the GBPUSD pair.

Supposedly, the trade was triggered (16:02GMT+2) when the price moved to 1.47742 except that the 1M chart shows that the price reached a high (at 16:02) of 1.47714 (difference of 2.8 pips). The trade erroneously opened and the price retraced back down and the SL was triggered.

This trade should not have been triggered in the first place. The pending order price, SL and TP were registered with the broker . Metatrader and my Internet connection had nothing to do with it.

Please take a look at your GBPUSD 1M chart and tell me the high was at 16:02GMT+2, 10:02EST.

Rick

BTW,
I verified the high price at 16:02 with my live account 1M chart and it was the same at 1.47714.

[rsmereka]

The following complaint has just been filed with Alpari UK:

Hello,

This complaint has been documented at:
http://www.pipcop.com/forums/general....html#post4209

for everyone to see.

Even though this error took place on a demo account. This trade should not have opened according to your own charts.

Please explain how this happened and what assurance do I have that this will not happen in my live account?

Thank you,
Rick Smereka
Account: xxx

I'll let you know the outcome.

Rick

[cogs]

I have had this type of trade placed several times in the past and you will see it regularly take place if you have stops placed that are visible. Stops are quite often targeted as this is easy money for brokers and market makers.

There several ways around this, the most obvious is trade longer term with trends and have enough capital to cover swings. The other which actually goes with long term trading is manually place stops by placing a close trade, not a stop loss visible order.

What I suspect has happened in your case is your chart is only showing median, open, closed or low prices and not 'high' which is maybe where your order was taken.

FX can be quite ruthless to say the least, it is all run by professional market makers with one aim in mind, Get Your Money! They do not know you and don't care who you are. It is a fact that just over 90% of FX traders lose money trading FX. If you don't believe what I have said here just try placing a trade during a quiet period of trading where there is low volume and you will see the price take opposing directing to your trade every time, albeit it may only last for 20-30mins or so.

Thos who object to the above statement will be working for or are brokers and will defend such comments to keep as many people trading FX as possible.

Just my experience after 13 years trading.

[rsmereka]

After more than two business days (24-28), Alpari UK responded with:

Dear Sir,

I am writing in response to your query regarding a demo trade that occurred on April 24th on GBP/USD.
I have included an illustration of the trade below and the explanation is as follows:

The trade was opened at 16:02 at a price of 1.47742 but the high on the chart is clearly 1.47714 (as shown on the illustration below).
Whenever you choose to buy a particular currency pair you will always pay the ASK price and if you choose to sell a currency pair you will always pay the BID price . The difference between the two is called the spread . This is simply the nature of the FX market and is commonplace throughout the industry.

The charting package built into MetaTrader 4 shows pricing for all currency pairs but it cannot show both the BID and ASK prices. (You are able to view both prices if you right click on a chart, select Properties, go to the Common tab and select Show Ask Line. This will enable you to see ASK prices but only on 1m and 5m charts).
Instead it shows only BID prices so when you are calculating the actual high at 16:02 you must add the spread which in the case of GBP/USD is 3 pips. After the spread has been included, the high which is relevant to you (as you were attempting to buy) is actually 1.47714 + 3 pips = 1.47744.
As you can see, your entry price (1.47742) is within this boundary. At 16:02 our server acknowledged that your order to buy was lower than the market price at the time and thus completed the trade immediately.

It is unfortunate that the market came back against you leading to a loss but I’m sure you’ll agree that nothing untoward happened whatsoever.
I can assure you that we do not manipulate market prices with the aim of activating stops. This type of practise is unacceptable according to FSA rules which we follow without exception.

I hope this answers your query satisfactorily and that you are content with our response.
If there is something you would like clarification on, please contact our Client Services team at your convenience.

Trade log
2009.04.24 00:23:01 65.75.247.198 '631846': order #46852704, buy stop 1.11 GBPUSD at 1.47742
2009.04.24 16:02:37 '631846': order #46852704, buy 1.11 GBPUSD is opened at 1.47742
2009.04.24 16:21:17 '631846': stop loss #46852704 at 1.47142 (1.47138 / 1.47168)

They are claiming what I thought they would do. Essentially saying that MetaTrader is taking the Ask price which is different than the price I put into the trade. This assumes that when you setup a pending order using MetaTrader, the trigger price is not what you think. In the case that you are buying, Alpari is saying that the Ask price will be used which is not the price that was entered into the pending order. Seems like the shell game to me.

Chart illistration attached.

Grumble, Grumble
Rick