Lately, I've been reading a lot about CFTC's new regulation requiring Forex brokers to modify their trading platforms to prevent traders from holding opposite positions on the same currency pair.   Whether you agree or disagree with the new policy, the fact is CFTC has spoken.

I read Thomas Sexton's letter to CFTC on December 9, 2008explaining NFA's rationale for the Compliance Rule 2-43(b): OffsettingTransactions. In it he stated, "Ten of 17 FDMs surveyed offer thestrategy to their customers, although for most it is a very small partof their business. Of these ten, six actively promote it on their websites, while another one merely indicates it is available.

Several of the FDMs told NFA that they had not offered the"hedging" strategy until their customers requested it. Although many ofthe FDMs admit that customers receive no financial benefit by carryingopposite positions, some FDMs believe that if they do not offer thestrategy they will lose business to domestic and foreign firms thatdo."

If the FDMs polled by NFA thought that hedging was important toeither their self interests or their customers, I think they would havetaken a more vigorous position opposing NFA's proposed changes. Ireally think the horse has left the barn and that the faint publicoutcry I am hearing is striving after wind. If CFTC's policies aregoing to be changed, the objections need to come from the FDMs, whoseopinions carry more weight than the retail trading public.

In light of the current economic climate there is mounting pressureon CFTC to tighten its regulatory reins. I think we can expect more ofthe same domestically and (if you're paying attention) also abroad.