Hey guys. Question.
Say for example, I go long on EUR/USD at 8PM, my Take-Profit is 50 Pips.
At 4:50 AM news is released that affects the Euro, and therefore, the broker
widens the spread to 10 Pips (Regularly 1.2 Pips).
Does this affect me? In other words, if I am alreadysay 35 Pips positive, and
news is released, and spreads are widened, etc. Will it eat away some of
my profit if my TP is hit during the news release? or am I already locked in
and the spread has no effect on me?
Thanks!
When you take a trade long you are given the ask price the
highest price but the market is at the bid price, the lower price, hence
you start say 1.2 pips down,
When the broker widens the spread the bid which you are following moves
away from the average price (price you would get without spread) by 5 pips
so your profit drops by 5 pips.
Yes it actually affects your order because the difference between the Ask price and Bid price widens and you have to close your order at widening spread.