do brokers hunt stop loss?

I do not think brokers set out to hnt stop loss but institutional traders do. What I mean is that big players like bhedge funds and multinationals also trade forex so they can guess where your stop loss is and place pending orders at that level forcing the market to move in the direction of your stop loss.

On the chart you can see signs of this kind of stop loss hunting with sudden spikes and long wicks that look odd.

For example you see a down trend with moderate wicks, all of a sudden one candle has a very long wick that looks odd and out of place (see image).

To avoid your stop loss being hunted, do not set it at obvious levels such as directly behind a resistance or support level.

No, brokers or banks don't hunt your stop losses. Maybe this video will help.

Trader Tom is such a good trader, and I like his response.

Most regulated brokers do NOT hunt stop losses.

But stop-loss hunting DOES happen — just not in the way most beginners think.

Let me break it down clearly:

1. Big institutions (banks, hedge funds, large liquidity providers) hunt liquidity — NOT your small SL

The forex market is huge.

Big players look for areas where many orders are clustered (liquidity pools).

Common liquidity zones:

previous highs/lows

obvious support/resistance

round numbers

where most retail traders put stop losses

They push price there to:

trigger stop losses

activate pending orders

get better prices for themselves

This is called liquidity grabbing, not “broker cheating.”

📌 Your small stop loss is not the target — the liquidity zone is.