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Author Topic: question about news trading  (Read 4600 times)

Offline ochosama

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question about news trading
« on: August 06, 2014, 01:17:34 AM »
Hi everyone,

I have a quick question aboout news trading. I have realised that when placing a stop order, the price at which i get filled is always different from the price i set the stop order at (due to slippage obviously)

now does the slippage also affect my stop loss or take profit ? by that i mean that if i set a 20 pips profit and the price moves favorably , can i potentially lose pips both when the position is open and when the take profit is reached.

Thanx to those who will take the time to answer

Offline Viktory

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Re: question about news trading
« Reply #1 on: August 06, 2014, 06:27:40 AM »
Hi Ochosama,

For market orders, buy stops, sell stops, take profits and stop losses, you can get both better or worse price, depending on spread, volatility and available liquidity when touching your order. Slippage is usually negative but can also be positive in some cases.

Limit orders though, in theory must be filled at same or better price than what you stated beforehand.

Best regards,
Vctor

Offline jeuro

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Re: question about news trading
« Reply #2 on: August 11, 2014, 09:03:03 AM »
Hi everyone,

I have a quick question aboout news trading. I have realised that when placing a stop order, the price at which i get filled is always different from the price i set the stop order at (due to slippage obviously)

now does the slippage also affect my stop loss or take profit ? by that i mean that if i set a 20 pips profit and the price moves favorably , can i potentially lose pips both when the position is open and when the take profit is reached.

Thanx to those who will take the time to answer


Yes it does, but depends on market conditions that is different with each news.

In most cases, as liquidity Providers  quote ask and bid with a wide spread, if you have  fixed stops you will be affected the most.


But  keep in mind that getting a "different price" ( due to slippage ) does not cause loss by itself.

Example. If you place a pending order to buy euros (Long eurusd) at 1.3550 but the Brokers fill you at
1.3570 .. at that point you have not loss anything, just purchase euros at a different price.

But lets say you have a SL of 20 pips at 1.3530 and  at the time of your fill the Brokers is quoting the bid at 1.3530  ( 40 pips of spread.) Then the Broker will execute your pending for selling the euros immediately  and you loss 40 pips. ... and if the spread is bigger then 40, the Broker would execute at whatever finds a buyer for your euros  and you could lose more then 40.

For your order of selling the euros at a higher price (TP) you also can be affected... if your TP was set at 20 pips from the price you wanted (1.3550+20=1.3570)  at the millisecond the spread goes to normal, the bid will touch
your TP.. but is was set at the same price you got fill, so you make no money.

Bottom line, and by experience, trading with no stops during news is how you get less affected by the slippage and the by momentarily spread widening.

J.

 

Offline indicator

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Re: question about news trading
« Reply #3 on: April 06, 2015, 07:51:03 AM »
Quote from: Viktory link=msg=317747 date=1407302860

Hi Ochosama,

For market orders, buy stops, sell stops, take profits and stop losses, you can get both better or worse price, depending on spread, volatility and available liquidity when touching your order. Slippage is usually negative but can also be positive in some cases.

Limit orders though, in theory must be filled at same or better price than what you stated beforehand.

Best regards,
Vctor


These days major problem is of slippage, news trading is not fun anymore, you get more losses than profit over all.

Offline Gox77

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Re: question about news trading
« Reply #4 on: April 08, 2015, 10:32:04 AM »
I think Plus500 offer a guaranteed stop in certain pairs if you are willing to pay an extra pip in the spread. I am uncertain if this is under all market conditions. They only offer it in a few pairs like eurusd for example.

Offline Jhenry

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Re: question about news trading
« Reply #5 on: April 22, 2015, 08:07:56 AM »
now does the slippage also affect my stop loss or take profit ? by that i mean that if i set a 20 pips profit and the price moves favorably , can i potentially lose pips both when the position is open and when the take profit is reached.
NAT

Offline Earleone

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Re: question about news trading
« Reply #6 on: April 22, 2015, 11:42:26 AM »
The short answer is yes. You can get slippage for your entry and also for your exit. With some brokers you can even get positive slippage for your exit. The Market makers or bucket shop brokers seldom or never gives you positive slippage. At least I can not remember I ever got it.
With ecn brokers it happens that I get positive slippage. Not often but it happens.

For news trading if you have been setting your TP hard to 20 pips and you get slipped 30 pips at entry a bucket shop will close your order with a 10 pip loss since your target is reached even if it is negative. I been slipped like 500 pips for gold sometimes. and order was closed with 300 pip loss since my target was some 100 pip profit. ( the pip value for gold is 100 if price goes from f.eks 1201.00 to 1202.00 ) 

Offline indicator

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Re: question about news trading
« Reply #7 on: May 07, 2015, 05:20:47 AM »
Quote from: Jhenry link=msg=338501 date=1429686476

now does the slippage also affect my stop loss or take profit ? by that i mean that if i set a 20 pips profit and the price moves favorably , can i potentially lose pips both when the position is open and when the take profit is reached.



If you get slippage towards your favor, then your TP will gets hit and your trade will be closed. If you got unlucky and price moved against you, your SL will be missed and order will be closed way after that slippage. All is in broker's favor ;)

Offline equityfx

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Re: question about news trading
« Reply #8 on: May 19, 2015, 10:54:56 PM »
Trade in news of high impact category will face some problem , some of them are requtes , slipages , gap and other . this make the order will not execute in the price that we expect . even when we use the account of floating spread. this make the  stop loss can easiluy be touched of price movements

Offline indicator

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Re: question about news trading
« Reply #9 on: June 03, 2015, 05:18:51 AM »
Quote from: equityfx link=msg=340201 date=1432072496

Trade in news of high impact category will face some problem , some of them are requtes , slipages , gap and other . this make the order will not execute in the price that we expect . even when we use the account of floating spread. this make the  stop loss can easiluy be touched of price movements


Yes these slippage and gaps are very bad things to happen these days during news time. A slippage can take your losses beyond your stop loss so you can lose more than you had risked on a trade.

Offline hybrid

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Re: question about news trading
« Reply #10 on: March 29, 2016, 03:30:26 AM »
Sometimes news are very perfect but there is a great rush of people for trading on specific point that is why slippage and re-quotes occur again and again. As a good trader we should accept this or wait for next market move where we get our desired trading.

 

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