Today in the morning I traded the NFP in EUR/USD and the Employment release from Canada in the USD/CAD. I used SL & take profit in both positions but both of them didn’t work correctly.
USD/CAD long: Entry Price 1.318, Take Profit 1.323, Stop Loss 1.317 & Filled price 1.32119.
Below you can see that the filled price was 1.32199 not the 1.323 in my profit target even when the price goes up like 72 pips from the entry price!! I don’t know why the system kick out my long position
EUR/USD long: Entry Price: 1.10991, Take Profit 1.11491, Stop Loss 1.10891 & Filled price 1.10754.
Here my SL is only 10 pips but the SL was trigger until 1.10754 23 pips below my entry price!!
Thanks for posting this but I just felt sad while i was reading it. This is a mistake I made nearly 5 years ago! And it’s sad to see people making it today. Especially when they dont need to.
So what you have just experienced is either/or and"
widening of spreads
slippage
Both are normal to all brokers but some are worse than others depending on how much liquidity they have and relationships to big banks/ institutions.
So during a data release or high volatile event your brokers spreads will widen because of a lack of liquidity. Ie not enough buyers/sellers. So you can only get in where the bid/ask is. It’s also a way for the broker to cover their risk as your trading cost will go up to take a trade which could whipsaw up/down.
Slippage is when your broker is unable to fill you at a price you want as there are no buyers/sellers at that price. So in eur/usd you wanted to get long at 1.1099 but because the market moved so fast there were no orders to take your trade so it goes past your price until the broker gets the orders to take your trade. It fills you at 1.1075 when they get someone to sell at that price but treats it as if you got in at 1.1099 as that was your original order. To get out it’s the same thing you need someone to buy your sell (to get out of trade). Its all dependent on your brokers liquidity and whether you have preferential execution.
My explanation is pretty basic as that’s how I understand it but there will be more experienced people who can give a more in depth explanation. I would recommend doing the babypips course as it is mentioned in there. It doesnt take a long time if you focus so would be worth starting it as it is the weekend.
You can look for the setting on your broker that if price moves past your entry and not executed within a pip or 2 then the trade should be cancelled. This way you’ll be protected against slippage.
Personally I wouldn’t recommend you trade this way, it’s very high risk and as you have experienced it’s not set up to give retail traders an edge.
Your explanation was very clear to me about the slippage. I asked to my broker and the answer is similar to yours:
"Please note that all stop orders (such as stop losses) once triggered are execute as Market orders.
This means once triggered they will be filled at the best price available in the market at the time of the execution
As the price move was substantial, the order received slippage when it was filled."
This is the case for the EUR/USD.
The USD/CAD I created the order with a trailing stop therefore when the price moved fast it trigger my trailing stop.
How do you trade the release of economic indicators like interest rates, NFP, GDP, etc.? Because since these news create a lot of pips I was thinking it was goods to prepare limit orders just waiting for the news.
It is very difficult to trade the news. And very risky so you should not do it. I trade fundamentals but I don’t trade the news. I’ll watch all news and form an idea of which currency is stronger than another then look to buy. But this is very time consuming. I’m doing this all day every day. If you want to trade the news, one way is to wait for the move then look for a pullback and get in as it continues. But you need to know whether the data released is good or bad for the currency.
Use limit orders to enter the market and for your TP order. See link below.
It is not clear to me what price you had the order at and at what price you got filled. Spread can affect your entry price and may widen if you’re trading off hours and volatility can affect slippage however liquidity should never be an issue since the broker trades against you and is on the other side of the trade.
Hi Alberto.GP
if you want to trade news , you have to do before the news , with practice you could identify the movements hidden before the news, I give you an example:
Unfortunately i dont trade fundamentals. Yeah I understand why you would want to trade the news. The fast moves, the volatility and pips but there is nothing easy about it. I dont know if retail traders can make consistent money having buy and sell around a news release. I have not been able to make a consistent profit doing this or even trading into news. Therefore I do not trade specific data releases. It became a gamble for me.
I have tried the method you mentioned, I have tried buying and selling at the same time before the news, I have tried buying after the news, I have tried guessing the release; they didnt work for me and also it was not always repeatable. Sometimes it worked, sometimes it didnt. You could try trading these moves on the 1 min chart and look for patterns eg pullbacks, breakouts etc. This may be more reliable but the market doesnt always move that fast, usually only if the release is unexpected. I wouldnt know when that is!
You need to follow fundamentals and know what the released value means for the currency to trade consistently.
