Why was my T/P not triggered?

Hello. I have a question. I had a set take profit at 1.2479 which was hit but when I came back to computer my stop loss had taking out my trade, but it did not hit that until about an hour after my price hit my t/p. I am confused as to why this happen. I have the chart provided on the attachment.

s/l= 1.2504

Is that the bid or ask chart? If it is the bid, then the ask chart will show you why you didn’t get triggered. It looks like the price only dropped two pips below your “trigger.” Unfortunately, you buy the “ask” and you probably missed your trigger by a pip or two depending on the spread you are paying…

Brokers only charge you a spread on the buy side of things. So, when you are shorting, such as in this position, the pair actually has to drop to 1.2479 less 4 pips of spread or 1.2475. In other words, the spread is charged when you buy back the pair (liquidating the trade, if you will) If the pair did not get that low, then your limit will not be executed, even though it looks like it hit the price on the charts. Looks like you missed your t/p by a pip or two. That hurts and believe me when i say that anyone who has traded the markets for even a month will know that feeling very well. It’s part of the game. Don’t worry

Wow I never even realized that. So everytime I short I need to set my t/p the amount of the spread above my target so when my actual target is hit it will be enough pips below the spread difference to execute the trigger. Well how about when you usually execute the trade you start off negative pips, or is that just when you go long? Thanks and thanks to you too hammocksurfer

You will always start off with negative pips, no matter what. What changes is your actual entry price, depending if you go long or short.

I think the easiest way to understand it is with a numerical example.

Let’s say you go long GBP/USD. The price on the chart is always the sell price (bid). So, if the chart is showing 1.8900 at the time of your entry, then your actual entry will be 1.8904, after the spread is added. If you set your t/p on this trade at 1.8950, then as soon as the charts show 1.8950, your t/p will execute because your spread was charged when you entered.

Now, let’s say you go short at 1.8900. Your entry price will show as 1.8900 because you are selling and that is not when spread is charged. Spread is charged on the buy side. This means that if your intended t/p is 1.8865, the market will actually have to drop another 4 points from 1.8865 before you are filled. They charge you on the exit of a short trade because that is when you are buying the pair back to liquidate.

Just remember that spread is always charged on the buy side. Does this make more sense?

Yes, I get it now. When ever I usually trade I never really followed what my price was at when I entered and exited. I just basically entered when my signals showed and exited fixed spots of t/p or other signals. Then just took the pips and never thought of the prices those pips came from. Anyway, thanks for your time and help. I can’t believe I miss that trade by ONE freaking pip. Oh well. Reps to ya.

Whoa! Whoa! Whoa!

Be very careful with that statement. It is only true that the chart price is your selling price if you are looking at a chart based on the bid quote. Not all charting systems and data sources work that way. Some use mid-rates, and others even show offers (if you choose). Make sure you know what you’re looking at.

Just remember that spread is always charged on the buy side. Does this make more sense?

No offense, but it really bugs me when people say that the spread is charged, for one, and that it’s just on the buy side for two. Firstly, your broker doesn’t actually charge you anything. It’s not like a commission fee. Secondly, the spread will negatively impact your P&L immediately upon your position entry regardless of whether you go long or short.

Let’s assume the market price is 100.00/10. If you buy you do so at 100.10, so immediately you’re on the hook for a 10 pip loss were you to turn around and sell (at 100.00). Similarly, if you were to go short, you’d have an immediate 10 pip loss because you’d be in at 100.00, but would have to get out at 100.10.

First, thanks for clearing up that tidbit of misinformation on my part. I really thought that we only see the bid price on the charts.

Second, i don’t take offense that it bugs you when i said spread is “charged”. I’m just not sure why it should bug you :slight_smile: I did not mean to make it sound like a commission fee but aren’t you getting a little caught up in the semantics of it? Let’s face it, the spread is a cost you must endure when executing the trade. Period. That’s all i meant to say.

Third, i realize that the spread is going to immediately negatively affect your P/L regardless of short or long. If you re-read the first line of my previous post, this is exactly what i said.

Sorry to everyone on the thread if i caused any confusion with my explanation.