Forex fifo violation
NFA Rule b The NFA recently enacted Rule b which effectively eliminates hedging by forcing brokers to close trades on a First In First Out FIFO basis. The NFA has added clarification to the rule, stating that customers can instruct their broker to off-set like sized forex. After all, big brother knows what's best for you, right? While FIFO may work on traditional escalators that require an orderly transition from point "A" to point "B"- but in reality, markets work more like elevators going up and down, true? This rule should only be imposed on government buildings with more than 20 floors where it belongs, and not in the capital markets. Hope president Trump repeals at least this part of this egregious rule. Only the so called "regulated brokers", love this However in reality this is merely a ploy to force investors to initially send more money to the brokers. The rich get richer while the retail investor pay the fees, so the big guys can trade for you. Hey it's better than the bank CD, right? The no hedging rule just makes it so much easier for brokers to pluck off your stop loss. The brokers will tell you that a work around is opening 2 accounts so that your strategy can work on different time frames. Just send more money. So if your strategy buys from a signal on the 4 hour chart and sells on the daily chart, but only if you are rich enough to have multiple accounts. The problems with opening an fx account abroad is that most of them do not offer cc and that is scary because banks do not offer e commerce or merchant account to business not deemed qualified. Also some only accept EU cc. ATC and FXDD allow Metatrader 4 to run older EA that hedge with a Back office Solution. I am looking for other brokers that do that. The FIFO rule applies to all Forex brokers in the United States. Since US citizens are allowed to open Forex accounts only with US brokers according to NFA rulesyes, you can say that FIFO rule is for people in the USA. The writer of this article is a moron. The new rules have crippled my forex trading. I believe they are also unconstitutional in our supposed "free" society. Let's say you buy a car, and then buy another car exactly the same, a month later. Wouldn't you consider it rediculous for the government to tell you that you have to sell the first car first, before they "allow" you to sell the car you bought second. They have no right to do that. You are not hurting or misleading anyone. The new rules are illegal and unconstitutional in a supposed free society. If you want to Hedge on MT5 have 2 client terminals in 2 family names, set up both with pending orders, 1 terminal will buy the other will sell. This angers me so much. Its getting harder and harder to make a profit doing anything in the US. I'm now committed to giving up my US citizenship and moving abroad, just so I can make a living at trading, I'm not going to do it immediately but look into it first to see the best way. Once out, I can open a corp in a tax free country, like the Cayman Islands. Then I can make profits from my US profits tax free, legally. Why, because little do people know but foreigners are not taxed on profits made in US by USA. I'm not talking about green card forex earners, I'm talking about foreign investments in the US. As you all said, this person does not consider commissions, nor the impact of introducing complexity. I think this guy was also paid to write this article. This world is so scary, how governments and the super wealthy who control them, have used computer technology to come up with these regulations to track everything we do and extract as much as possible. Now see why our own citizen's like Timothy Mcveigh are fighting the feds. Before, I though what he did was lame, but now I see its a war for true life, liberty and the pursuit of happiness. It's going to get a lot worse before it gets better. Years ago I traded currencies and I was presently considering opening an account again when I noticed these "FIFO" rules were put in place. I wonder how many others feel the same way as me. Way too many self-professed "professional traders" who announce themselves as such on forums and blogs make me laugh when time and time again, they prove that they are not professional traders. If they were professional traders, especially professional and very profitable scalpers, they would spit on NFA's rulings. Professional traders should trade the opportunities rather than sit on an open position and let it ride for 2 weeks or more. If this is how you trade, yeah, then I guess FIFO is great. But it sucks for professional scamper traders who are and were very profitable and efficient. They along with me, trade opportunities. And opportunities present itself at various moments Now, brokers will handle FIFO rules differently but scalpers will now establish offshore addresses and go there instead rather than attempt to deal with US based and NFA regulated brokers. I am still shocked and dismayed that so many so called experienced traders don't understand what hedging really is. The next thing will be a additional special tax on profits made from forex violation for individual U. TRADER dont laugh, because the tax is being sent for voting as i write this, and yes, the good traders are offshore cause there is no place here for them and yes, it was a sweetheart deal between the brokers and the NFA once again, just as the SEC works for the market makers and not the retail traders. Now I do both, and the current rules in the USA but fortunately not with the Swiss prevent that HEDGING, per se, although it controls margin in a positive manner, is prob the least favorable method of trading, based on "guessing" as it is, and NOT knowing, and so I have no real feelings concerning that, but to eliminate the advantage of counter trading in one account if you hold a long and a short, the margin never violation and the SPEED of being able to enter the trade, opposed to finding the right trading platform, remembering what you intend to do, and then having to go to the other trading platform to now enter the "averaged down" long trade is a royal pain in the maximus glutimous! So, being a simple person who accumulates a very decent number of pips in a day, the Swiss strike me as remaining true to their national heritage, and that aint chocolate or cookoo clocks its MONEY! Maybe newbs dont need the ability to counter trade, move VERY fast and trade the 30 second charts, but any scalper heading for a minimum of pips a day MUST have that ability. What all experienced Forex traders know is that constantly having to exit and re-enter trades in the same direction is costly, both in terms of spread loss and commission. And if you're not paying commission, but using a spread profit i. The above analysis doesn't take into account spreads or commissions. The NFA rules fifo make your cost of trading higher. Say there's a nice long trend, and you're in with Trade 1. But you spot a potential turn. If you just keep your long trade it, and hedge short, and your hedge stops out, then your long positions just continues. That's just two trades. With the new rules, there would be 3 trades. Addtionally, you have spread loss now, for the additional re-entry trade. In summary, the NFA FIFO rule assumes an ideal trading model, where there are no commissions and spreads, and that isn't the real world of trading. For those of you MT4 users who don't know forex yet: The new MetaTrader 5 platform allows only one position on a specific currency pair and it's a complete NFA FIFO compliant. The MT5 will always close oldest trades first - multi-positions strategies will be no longer possible. This is not acceptable for me and even though I got used to MT4 and it's custom indicators and helpers I wrote myself, I will have to move to a broker who offers a platform, where I can manage my trades as I need. Even my russian broker which is not NFA regulated will switch to MT5 soon and force me to either accept the completely ridiculous FIFO rule or find a broker who allows multi-position trading without FIFO. If other countries on the world adopt similar regulations, then Im out of the business because I will not be able to freely decide what and when to buy or sell. Which is not a regulation but a violation of the very basic principles of trade. Pointless violation that is sending me to search for brokers that do allow hedging. I will be doing business with non NFA regulated brokerage houses. The NFA is a nasty regime imposing worthless regualtions on us. They can F-off and leave us alone as fifo as I'm concerned. They are simply trying to get rid of forex traders so that the futires traders know where all the actual volume is. Welcome to experience the Broker Search on a whole new level! Hedging under new NFA regulation: FIFO first-in, first-out rule. We should all get together and file a lawsuit against NFA as NFA is nothing but a MAFIA. If anyone knows of a broker who accept us cc. Hey Americans, Please do something to get this rule taken back. Get the forex rolled back. Also, the problem with trade copiers from professional trader outside US that hedge. Is this fifo rules made for pple in the usa. Regulators have driven investors offshore once again You done hit the nail right on the head, and hard! Almost looks like the big brokers and banks paid the NFA to pass the regulation. Then paid the developers of MT4 to make strategic trading on MT5 impossible. All NFA regulated brokers will have to use MT5. Well I guess theres one thing to say about that What code is in the image? US Forex brokers UK Forex brokers Australian brokers Canadian brokers New Zealand brokers Swiss brokers Middle East brokers Asian Forex brokers Indian Forex brokers. Forex regulation NFA regulated brokers FCA UK FSA UK brokers ASIC regulated brokers. How to choose a Forex broker? How to become a Forex fifo Introducing broker vs White Label? Margin calls vs Stop out levels? Market vs Instant execution? FIFO Stop loss policy under new NFA rules. New Poll How many brokers have you changed during the 1st year of Live trading?:. I stayed with my first broker. Forex brokers contests Forex bonuses Forex No-deposit bonuses Forex Incubator Programs Forex brokers providing Free education Oil Forecast Technical Analysis on Majors Top 10 reasons not to deposit Top 10 Forex brokers Alexa. Who's online There are currently 25 guests online. COM ALL RIGHTS RESERVED. Sterling unwinds some pressure. Basics Forex vs Binary Options - 2. FIFO first-in, first-out rule 20 comments NFA Rule b The NFA recently enacted Rule b which effectively eliminates hedging by forcing brokers to close trades on a First In First Out FIFO basis. BrokerGuru April 30, FIFO Stop loss policy under new NFA rules SURVEY New Poll How many brokers have you changed during the 1st year of Live trading?: Top 10 Forex brokers Alexa Search Who's online There are currently 25 guests online. BROKERS Search Review Add a broker. TERMS OF SERVICE Disclaimer Privacy policy. 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