I came back to MetaTrader this evening and noticed that the USDJPY chart had a HUGE difference in values between what was last charted Friday and what was charted this evening. It was around a 200 pip movement.
My question is if I had an open order with a brokerage, and I had a S/L set at 50 pips, would the brokerage honor it? The reason why I ask is because it appears to me that there was no data to even [I]suggest[/I] the S/L would have been triggered in time. I would hate to have come back and had an open trade and got hit with a 200+ pip loss. :eek:
(You’d be well advised to read through the other sections on orders as well).
What you are seeing is a ‘gap’ and, in this case, the price ‘gapped down’ between YOUR close on Friday and YOUR open on Sunday (and this is due to the fact that even although WE as retail traders cannot trade over the weekend trading does in fact go on over the weekend between the banks).
Now: a stop order becomes a market order once it’s triggered and this market order is executed at the first AVAILABLE price. So in THIS instance: the first AVAILABLE price would have been the first available price after YOUR open on Sunday night. You therefore would have taken the loss.
And on this subject: this is NOT the broker ‘doing you in’. Many times this type of ‘action’ is referred to as ‘slippage’ and MOST people think it’s the broker that is ‘stealing your money’. It’s NOT!!! It’s how the market works ‘for real’.
Question: Do gaps like this occur frequently overnight or over the weekends? In the past I’ve left orders open overnight and through the weekend, but now I am thinking that might be a really bad idea. Obviously, the news lately is mostly to blame, but I’d prefer to protect my funds wherever possible.
