Daily Forex #51 - I Got CHEATED By My Broker Part 2

A few days ago I shared about how I accidentally stumbled on Forex and made a career out of it. To read that blog post, you can go HERE.

Yesterday (<-- Click this link to read yesterday's story) I shared about an incident when my MT4 platform froze just before my trades triggered and my entries suffered huge gaps. Today I continue with part 2 and came to a realization that brokers do not want you to win.

If you had not read Part 1 yesterday, please read it first so you know what's happening.

I had lost 32 pips (about $3,200) due to the gap in Entry Price and another $4,000 from a trade that was suppose to be profitable. I double checked the order and everything seem to be right. I had placed an entry to BUY and also my Take Profit was set. The Market Price came up to my entry and continued going up. This means I should be making money but I had lost $4,000 instead.

Upon closer inspection, I realised to my horror that my Entry Price had gap a massive 60 pips! This was my original order placed :

• Entry Price : 1.34567
• Stop Loss : 1.34367
• Take Profit : 1.34767

But looking through my trade history, I realised that my order was filled at 1.35167! This was a massive gap of 60 pips! So what happened was that my trade was filled and exited immediately because my Take Profit was also triggered. The thing is my Take Profit was 40 pips below my Entry and therefore I ended up losing 40 pips instead of making a profit of 20 pips based on my original order placed.

I immediately called the broker. The website listed their Trading Desk number which was a UK number and I made a long distance call to them. I was practically screaming at them on the phone and they replied that I should email them and state what was the issue or problem.

I had just lost $4,000 and they wanted me to email them! I insisted that they should take a look at my account or my trade and resolve the issue on the phone. The person at the end of the line also insisted that there was nothing he could do if I don't email in. Ok fine! I emailed them. And to their credit, they did reply to me within 1 hour and the whole issue was resolved within 4 hours from the time I sent out the email.

What they replied was that the price was very volatile during London Opening hours and the price they gave me was the best price. I have seen the market move during London Open but I have never seen a gap of 60 pips before! They agreed to void the trade and return me my losses. They couldn't give me a profit on the trade because of some reasons I couldn't remember already. It left a sour taste in the mouth and I accepted that this result was probably the best I could hope for.

But this trade was the straw that broke the camel's back. I immediately withdrew all my profits (about $12,000) from the account. I still maintained an account balance of $1,000 and continued trading on the account. The reason was because I still had no idea the broker was doing some dirty business by not giving me my original entries. I still thought the reason the MT4 platform froze was because of my internet connection or my computer was slow.

The next few days, I continued trading and I monitored all my trades very closely. Surprisingly, my MT4 platform did not freeze and there was no gap in my Entry Price. As I grew my account up to $3,000 by the end of the first week, I noticed something. Some of my trades started having small 1 to 3 pips gap. My MT4 platform started to freeze a little and the candlesticks in my charts always seem to gap a little when the Market Price approaches my Entry Price.

That's when I came to the realisation. The broker is CHEATING me! They don't want me to win!

Why? Why do Forex brokers not want their clients to win? Because some brokers operate as a Market Maker. They are basically like a casino. They accept our trades and hope we lose. And majority of the traders lose. So when we lose, the broker wins. But when we win, the broker is losing to us. We are eating into their profit margins.

A ffew days later, I withdrew out all my money from this broker and closed all my accounts. I never traded with them again. A few years later, this broker went bankrupt.

This was one of the incidents that I have encountered in my 13 years of Forex trading. Tomorrow I will share some other incidents so that you can learn from my experiences too!

Hope you enjoy today's blog post and if you have any questions please feel free to ask in the comments below and I will definitely respond to you.

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Daily Forex is my way of sharing my personal thoughts on the Forex Industry with would-be traders as well as current traders.

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Here are some interesting topics to start you off :

• Daily Forex #20 - Can You Really Make Money Trading Forex?
• Daily Forex #13 - Make Your First $100,000 Trading Forex
• Daily Forex #12 - Forex Is Not a Get-Rich-Quick Scheme
• Daily Forex #9 - 2 Main Reasons Traders Fail

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