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False Spike on Live IG?


Ukeno

Question

Just had another spike on IG's Dollar Index. When compare to DXY futures on Trading View - Non seen. 

This is on a live Spread account and is unacceptable, Im sure it would have closed positions.

 

Why has this occurred IG?

spike2.png

Spike.JPG

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Hey - DXY futures are avaliable on the platform using the 'forward' option at the top. On the futures side of things you can see that there wasn't a spike. 

image.png

 

On the spot market, which will be a blend of 2 futures contracts (more here https://www.ig.com/uk/commodities) you can see there was a spike. In this specific instance the spike down was because 

  • it was a period of high vol over the BoE interest rate decision 
  • the December future, due to liquidity factors, doesn't tick as smoothly. Whilst this price is therefore valid on the spot blend, it does seem to have experienced a gap. 

image.png

I don't believe you have an open position in this market or a working order, so I hope the above explains how this was printed on the charts. In the future you may want to consider the 'futures' market if you are trading US Dollar Basket. 

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This explains that it was printed but not why. Im aware of the Spot pricing in relation to contracts but wanted to ask what justification there was for this? Im not convinced there was one? 

 

Even though this is a proxy of the dollar index it is unreasonable to assume that jumps in volatility just appear at random when the underlying market doesn't demonstrate the same occurrence.

This is why spread accounts wipe out clients and deservedly receive  a bad reputation as a result.

A stop below Pivot on the above markets pictured should have been more than adequate to ensure a position in this market - not seemingly the case on IG Spread accounts, and without any real reasoning.

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But that's what I'm saying - the reason why this was printed was because it was a direct reflection of the underlying market in the December futures contract at that time. 

See below. DXZ9 is the contract (DXY) with Z9 referring to December 19. You can see the bid blew out to 97.850 and then even lower at 96.710 which would have had an impact on the blended spot price on IG. 

image.png

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