EUR/USD spike lower likely driven by Algo players

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The most illiquid time of the day in the FX market is the two-hour period just after the NY close when Australia and New Zealand are pretty much on their own. If you see some sharp 10/15 pip spikes in any currency pair during this time, then its probably an Algo fund trying to push the market around for a very short-term profit. They usually pick on more illiquid pairs like cable and USD/CHF, as all bullies like to pick on weaker opponents.

2012-05-17T22:18:28+0000

All|Asia Pacific

Cable|EUR/USD|USD/CHF

Sean Lee

9 Comments

  1. great info Sean…
    what are algo’s strategies? here they have pushed down here for what? SL hunting?

    thankyou
    powerpip

  2. Hi Powerpip, simple bullying tactics, they try and pick a weak side where s/t stops might be sitting and jam the mkt through; not sophisticated but effective!

  3. Hi Sean, kinda the same question as powerpip… was the spike down pip hunters? Do Algo’s have the ability, as set by the users to make that sort of move?

    Thanks for the great job!

  4. cooooooooool………. :)

  5. Almost all big Boys with endless balance do exactly very same thing. In periods of already done move, they push for some more 10-15 pips to spread confusion. Btw: when You look at cable daily chart we can think that some nuclear bomb ruin half of UK in past three days! All longs of this world are wiped. Time for galoping upward?

  6. Very helpful information and wanna just say THANX, Sean! In fact, i can already go to bed: TP level touched! Algo players then… well… good night to all! Greets!

  7. Are they algorithmic trading?

  8. And some wonder how Goldman and friends can only have a single losing trading day. With nearly infinite free Fec and taxpayer money – they can’t loose. Unless they do something really arrogant – similar to the JPM London bozos. If they would only cut off all this free money to the biggies…

  9. Yes Demetris

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