Why do deep pullback occur?

Aside from the news/current events?

I’ve read that big financial institutions deliberately do this? but why?

As for me this is the trickiest part of forex. It’s like a bomb in your backpack that’s going to explode anytime soon.

There are time that you’re just riding on the trend earning profit already and a deep pullback occur covering like 4 previous bars and your stop loss got hit.

Because they want to sell some :slight_smile:

@matzhee… This will answer your question… more valuable Youtube content…

No it doesn’t. Just more marketing bull on YouTube. But I’m not here to argue with you trendy.

@matzhee. Take what you will from this video but remember these points

  • While retails traders provide 90% of all transactions, we only provide 5% of the volume.(% indicative only)
  • We’ll never know where institutions transact or the volume they do.
  • Nobody is hunting stops. Especially yours and mine.
  • It takes stupidly huge amounts of money to manipulate the market.

Why do these deep pullbacks occur, its called a correction because,institutions, for all the resources and money they do throw around get it wrong like us.

Finally about YouTube. Would you let a mechanic work on your car because he has watched a YouTube video. How about a doctor, would you let him preform surgery? You not going to learn anything from YouTube. There is just to much marketing filth to filter through.

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@_bob

Thanks! That’s very informative!

Who are these institutions? banks? forex borkers?

If they are wrong in a certain position and wanted correction, wouldn’t the wiser thing to do is ride on the trend instead of opening position against the trend?

Large banks/Market makers.

If you trade currency futures, it’s the institutions that show up on the DOM/Level 2

Simplest answer is that these institutions ARE the trend. The market goes where they take it.

Market makers move huge $ and they do it in stages/steps.

Sometimes they drive the market short term in the opposite direction of what is intended long term in order to build a position.

These long term positions can take months/ years to develop.

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Banks, hedge funds, central banks. These guys are the underlying market and they certainly don’t trade to speculate. The market is there because someone, somewhere needs to exchange currency. They profit from the exchange not from price difference. What we provide as speculators is volatility.

Maybe using the word wrong is misleading. Think of it as a clearance sale. If the bank/s build up excessive stock they need to dispose of it. Its called inventory management. They are not losing money doing so. Just balancing the books.

Look up “W211 bouncing door lock syndrome” on You tube - You tube has it’s merits !

Don’t know too many Mercedes owners that work on their own car lol

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Well you know one now - lol - £850 - garage fix v £5 own fix - better than trading any day !

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Isn’t this exactly what was demonstrated in the video…???

It’s the biggest collective of publicly accessible information resource in the history of mankind…

Some of the simpler folk just have no idea how to use YouTube information…very unfortunate…

Sorry I haven’t had a chance to watch it yet.

The real reason pull backs occur is this :smile:

Is this a joke?
Not good mate, not good.

I think the enthusiasts still driving those old, collectors’ 1950’s/1960’s models might, but not so much the new ones, anyway.

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It’s a huge market and the difference between the buyers & sellers is not much high (generally), that’s why, pullback is very common scenario here.

I know pullback is just normal because if not almost all of us is going to earn from forex right away.

My question is really about the “deep” pullbacks that major financial institution are doing. I think @_bob clearly explained it already.

That’s a turbo intercooler sealing ring.

Symptoms smoking slightly on accelleration, lagging turbo, lowered mpg - Probably a little over £200 saved there :slight_smile:

4 or 5 little fixes like that and you have enough to fund a modest trading account !

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It makes the trend more strong. By doing so Big Money shake the weak leaves of the tree. Like if you want to jump high, first you have to go back few steps. If you try to jump by standing still, you won’t be able to jump high. You can also say it takes fuel so that it can run more.

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