I recently had a trade on and the stop loss was executed several pips away from where I had set it. The price then turned around and then hit my profit target. It did not reach my stop loss price and yet the stop loss was executed so I lost money unnecessarily.
I contacted the platform (Forex.com) who have said “Due to market volatility Stop loss order may not get executed at the specific price set, however, it gets triggered at the price set and executed at the next prevailing price.
While Stop loss and Take Profit order do help manage the risk involved in the Forex trading market, they are not guaranteed orders.”
Obviously accuracy is paramount in trading so I’m perplexed at their reaction. Do all platforms/brokers do this, or is it just Forex.com?
Most broker charts show only the Bid price. Therefore the spread is concealed form you unless you continuously monitor the price quotes or you can use the chart’s Settings to show both prices or alternate between the Bid and the Ask.
The “normal” spread between the two can be increased by many times during times of unexpected market events, news announcements, around open or close etc.
Widened spread is the most common reason for an surprise stopping out. We’ve all had it at some point.
Stops are not always executed at the set price. If the market is moving very fast, the broker can only execute at their next available price. This is normal.
But if this slippage happens frequently, and the slippage is big, especially both during calm market conditions, I would look for another broker.
Thanks Tommor. The spread is usually taken when I open the trade (my opening position is not at the price I entered at to make up the loss), so Im unsure why it would also be attributed to the exit of a trade too?
When you are go long, your position will be open at ask price and close at bid price. When you are go short, your position will be open at bid price and close at ask price. Spread could be wide, when, for example important news are release and price can touch your sl or tp.
Slippage is common when trading during a time when the market is volatile. An example would be the end of the trading day at 5 pm EST. As mentioned earlier, this is fairly normal. Our execution score card shows our normal trading execution speeds. Please see the following link to view this:
Understandably, it is harder to trade not knowing the spreads of the pairs being traded. For that reason, we display our spreads on your trading platform in your Watchlist for transparency.
I think they all probably do it, the grumble I have is that the spreads shown on my chart are not the same as my broker’s. Sometimes I enter a trade , say a buy, and the trade opens above where the price is on my chart. So the price has to move more before I get into profit. It also triggers stop loss before even reaching it,ever, it goes down and I’m out at a loss even though it goes on into profit. Pointless even talking to them about it, you’ll never get anything meaningful out of them. I can’t rely on putting a stop loss at break-even for risk free trades, I have to make sure to put the stop at least 5-8pips above or below the open. It’s scandalous but you don’t see anyone doing anything about it.
Many of us have been abit 'paranoid" about this including me .It wouldn’t be worth it,an established Broker will make enough money legitimately.As mentioned above it will probably becauses of the traders chart settings bid/mid/ ask price , widening of spread between the openings of sessions.Slippage high/low volitility
Charts and quotes are always slightly adrift from each other. I don’t know whether this is because they use different data sources, or whether there is a different algorithm to translate data into a graphic on the chart. But the quotes are definitive, not the charts.
Its maybe another reason why very short-term day-traders mostly lose.
I was viewing the AUD/USD around 1:50 am on the 10 minutes timeframe .At this time a bear wick which was (I leave my charts on mid,as it was a buy the charts should have been adjusted to bid (sell)) about half the candle ,nearly hit my stop.Obviously it takes moments for the candle to rise to center, the next candle was green opened 6 pips higher than bottom of the previous candles wick.
Moments later I was out the trade. It seemed.like about 3-4 minutes before the trade was actually closed .As I thought how on earth am I closed out as the spread was only ajusting between 0:6 and 0:9 maybe 1:3 .Also strangely I was looking at the demo prices for other instruments lows and highs for the day and they matched the live but the AUD/USD was 0:3 different.I rang the Broker to try and get some confirmation what had occurred. He confirmed the low of the day Aus/USD but could not explain why the demo price was different or an explanation why I was closed out late.I’m not saying there was any “foul play” probably some glich somewhere in the charts or platform
Real account chart prices, real account quotes, demo account chart prices and demo account quotes are all very slightly different from each other at any specific moment in time. But they shouldn’t be very far apart.
In particular, real account quotes move much faster and are much more active and volatile than real account chart traces. I guess its possible to have a spike in the quotes which you will never see in the chart. If its a seriously wide divergence, and it was happening regularly on majors, I think the only answer might be to go for a larger broker who is less exposed to aggregate risk.
Yes I see what you saying, though I think the peculiarities ,was more to do with, I should have been closed a few minutes earlier on the wick .as that was lowest price of the session,.Not when the next
bull evolved very bizzare . The daily low AUD/USD 6877:2 on this chart
Forex.com- given my SL and TP targets aren’t executed on almost a weekly basis, that seems to be an awful lot of slippage. Even on Wednesday my TP level was hit and exceeded twice on a trade and it didn’t execute. And two weeks ago a SL wasn’t executed and carried on for more than 40 pips beyond my stop loss position.
This sounds like trouble. If you bring this sort of gapping to their attention, a decent firm will reimburse the account to correct things, if the issue was theirs. There’s always the possibility that one team is running a policy which is not authorised by the company so it might be worthwhile trying to get to someone higher.
If they refuse, then you can take it they aren’t concerned with you, their regulator or your lawyers. Which seems to be a valid exit signal.