There is no clearing house standing between you and a retail FX or cfd counterparty, and no exchange price to appeal to. The contract is with the broker, which is why its regulation, capital and client money rules matter more than in exchange-traded markets.
OTC also means prices differ slightly between venues and that historical data from two brokers will not match exactly. Futures such as es or the CME's currency contracts are the exchange-traded alternative, with central clearing.
Example: three brokers print the EUR/USD low of the day as 1.08234, 1.08229 and 1.08241. A stop at 1.08235 was hit at two of them and missed at the third, and all three records are equally valid.
Related: counterparty-risk, cfd, interbank-market, segregated-funds