Jump to content

Trades closing way before stop loss


Recommended Posts

Posted (edited)

My trades keep closing way before my stop loss and I can't seem to figure out why. I'm aware of slippage and spreads but some of them still don't make sense. Today I set a an order to sell at 1.37611 with a stop loss at 1.3766 and limit of 13749. The price filled my order and then moved down towards limit, came back up to 1.37607 where it apparently hit my stop loss and closed the trade. Price then went down far below my limit so should have been a good trade.

Basically my trade closed while it was in profit, saying it was at the stop loss.

Please can somebody help is there any way I can change the settings to make the trades more accurate as I can't seem to get the system to work, even close, to correctly.

Thanks

Edited by ryanair737
Posted
3 minutes ago, ryanair737 said:

My trades keep closing way before my stop loss and I can't seem to figure out why. I'm aware of slippage and spreads but some of them still don't make sense. Today I set a an order to sell at 1.37611 with a stop loss at 1.3766 and limit of 13749. The price filled my order and then moved down towards limit, came back up to 1.37607 where it apparently hit my stop loss and closed the trade. Price then went down far below my limit so should have been a good trade.

Basically my trade closed while it was in profit, saying it was at the stop loss.

Please can somebody help is there any way I can change the settings to make the trades more accurate as I can't seem to get the system to work, even close, to correctly.

Thanks

Hi, which market?

Posted

I suspect I might have been caught by a similar thing once or twice, so I'm interested in investigating this using the chart.

I assume this is GBP/USD.  What time did it open and close?  As accurately as possible, please.  To the second would be good.

I have put a couple of my unexpected closures down to a sudden widening of the spread.  Which, of course, you have no control over.

Posted

During the 07:00-07:01 candle, as you say, the mid price hit a high of13762.1, which was well under your stop-loss.

However, the high bid and ask prices were 13757.1 - 13767.1 (a spread of 10), and since the ask was above your stop-loss it triggered.  Painful.

Posted

**** I see that now, thanks for pointing it out. Is there any way I can try to factor this in?

For example when back testing do you use the ask/bid price rather than the mid?

Thanks

Posted
2 minutes ago, ryanair737 said:

For example when back testing do you use the ask/bid price rather than the mid?

Yes, you should definitely use the ask/bid price when backtesting. Spreads change constantly based on market conditions, time of day etc. and can have a significant impact on the profitability of any system.

Posted
59 minutes ago, andysinclair said:

Yes, you should definitely use the ask/bid price when backtesting. Spreads change constantly based on market conditions, time of day etc. and can have a significant impact on the profitability of any system.

I'm trying to work out the best way to do this. Do I need to keep toggling between the bid/ask price view as I'm backtesting to see where my buy in, stop loss and limits would be hit. Or is there another way to factor it in? I'm guessing as it keeps changing I can't just add/subtract a certain amount of pips.

Thanks

Posted
8 minutes ago, ryanair737 said:

I'm trying to work out the best way to do this. Do I need to keep toggling between the bid/ask price view as I'm backtesting to see where my buy in, stop loss and limits would be hit. Or is there another way to factor it in? I'm guessing as it keeps changing I can't just add/subtract a certain amount of pips.

Thanks

yes you do have a problem there, IG operate a variable spread system and though that has several advantages for traders it makes for problems eg backtesting. 

You might try just testing during main market hours and avoid the higher set spreads outside main hours but still will have a problem with periods of volatility.

Another possible aid is that though the web based platform doesn't have the function to display both bid and ask at the same time the Prorealtime and the mt4 platforms do.

Might be worth looking at mt4 just for backtesting as it also auto records test data.

Posted

Your main problem is your strategy.. the risk reward is fine as it looks like 2:1. But the gap between your stop is limit is tiny, it’s 0.12%. That means your stop is about 0.04% from your entry and limit is 0.08% from entry. You’re going to struggle to get any consistency with that.. market can move up and down and touch the stop too easily, it needs to be wider. By the same token, you can easily get big winners than 0.08% so you need to widen both.

I’d look at something like average true range and see what’s the expected size of the moves then determine profit targets from that and set stops in proportion to that and in appropriate areas.

Even if there was no spread it would be a struggle. But as you’ve found out it makes a difference.. the spread is more noticeable the tighter your trading range is

Posted
20 hours ago, Caseynotes said:

yes you do have a problem there, IG operate a variable spread system and though that has several advantages for traders it makes for problems eg backtesting. 

You might try just testing during main market hours and avoid the higher set spreads outside main hours but still will have a problem with periods of volatility.

Another possible aid is that though the web based platform doesn't have the function to display both bid and ask at the same time the Prorealtime and the mt4 platforms do.

Might be worth looking at mt4 just for backtesting as it also auto records test data.

Sweet I didn't know mt4 was better for backtesting. I'm gonna give that a shot. Thanks

Posted
2 minutes ago, ryanair737 said:

Sweet I didn't know mt4 was better for backtesting. I'm gonna give that a shot. Thanks

if you need any help setting it up just sing out.

  • Like 1
Posted
1 hour ago, Caseynotes said:

if you need any help setting it up just sing out.

This may be a really stupid question.. When shorting would my limit be hit at the bid price and stop hit at ask price? Vice versa for long positions. Or is it when shorting, both my stop and limit will be hit at ask price and long positions would both be hit at bid price?

Thanks!

Posted
3 minutes ago, ryanair737 said:

This may be a really stupid question.. When shorting would my limit be hit at the bid price and stop hit at ask price? Vice versa for long positions. Or is it when shorting, both my stop and limit will be hit at ask price and long positions would both be hit at bid price?

Thanks!

it is a bit twisted;

to get into a trade you buy the ask or sell the bid.

For shorts -  the bid price must hit your order to trigger the short entry.

 - to get out of your short trade you do the opposite, you need to buy back your sell position so you buy at the ask price so the ask price must hit your stop loss or take profit target.

 

(And for longs it's the opposite way round).

 

Posted
12 minutes ago, Caseynotes said:

it is a bit twisted;

to get into a trade you buy the ask or sell the bid.

For shorts -  the bid price must hit your order to trigger the short entry.

 - to get out of your short trade you do the opposite, you need to buy back your sell position so you buy at the ask price so the ask price must hit your stop loss or take profit target.

 

(And for longs it's the opposite way round).

 

Got it, thank you!

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • image.png

  • Posts

    • TASI Index Elliott Wave Analysis Trading Lounge Day Chart TASI Index Elliott Wave Technical Analysis Function: Bullish Trend Mode: Impulsive Structure: Gray wave 3 Position: Orange wave 3 Direction Next Lower Degrees: Gray wave 4 Details: Gray wave 2 is complete. Gray wave 3 is now active. Wave Cancel Invalid Level: 11324.751 The Elliott Wave analysis for the TASI Index daily chart from Trading Lounge highlights a bullish trend, with the current movement following an impulsive wave pattern. Gray wave 3 is identified as the primary wave in progress, indicating strong upward momentum. Positioned within orange wave 3, this structure aligns with a broader bullish perspective, reflecting continued positive sentiment in the TASI Index. The completion of gray wave 2 has paved the way for gray wave 3 to develop. Wave 3 is typically characterized by the strongest and most sustained momentum in the Elliott Wave cycle. The current position of gray wave 3 within orange wave 3 further supports the bullish outlook, with expectations for continued price increases as gray wave 3 unfolds. A critical invalidation level is set at 11324.751, serving as a key reference point for the wave structure. If the TASI Index drops to or below this level, the current Elliott Wave analysis would be invalidated, indicating that the bullish trend may not persist. This could suggest a shift in market direction or the beginning of a corrective phase, necessitating a re-evaluation of the wave structure. Summary The analysis supports a bullish outlook for the TASI Index, with gray wave 3 actively driving the upward trend within the framework of orange wave 3. Traders should closely watch movements near the invalidation level at 11324.751, as a break below this point could challenge the bullish trend, signaling a potential reversal or correction. This level is a critical benchmark for assessing the integrity of the ongoing bullish structure.   TASI Index Elliott Wave Analysis Trading Lounge Weekly Chart TASI Index Elliott Wave Technical Analysis Function: Bullish Trend Mode: Impulsive Structure: Orange wave 3 Position: Navy blue wave 3 Direction Next Lower Degrees: Orange wave 4 Details: Orange wave 2 is complete. Orange wave 3 is now active. Wave Cancel Invalid Level: 11324.751 The Elliott Wave analysis for the TASI Index weekly chart from Trading Lounge reflects a bullish trend, driven by an impulsive wave structure. Orange wave 3 is currently developing within the broader navy blue wave 3 framework, signaling strong upward momentum. The impulsive nature of this wave structure supports a sustained positive outlook, with potential for additional gains as orange wave 3 progresses. The completion of orange wave 2 has set the stage for the advancement of orange wave 3, which is a critical phase within the Elliott Wave cycle. Wave 3 typically represents the strongest and most dynamic movement in the trend, often characterized by significant upward price action. The alignment within navy blue wave 3 further reinforces the bullish outlook, suggesting continued positive momentum. A vital invalidation level is set at 11324.751, acting as a key point of reference for this analysis. Should the index fall to or below this level, the current wave structure would be invalidated, potentially indicating a trend shift or the start of a corrective phase. This level serves as a benchmark for traders to evaluate the strength and sustainability of the current bullish trend. Summary This analysis indicates a bullish trajectory for the TASI Index, with orange wave 3 driving the upward trend as part of the larger navy blue wave 3 structure. Traders are advised to observe the index closely concerning the invalidation level at 11324.751. A decline below this threshold could signal a possible reversal or a need to reassess the trend structure. This level is critical for validating the continuation and strength of the ongoing bullish movement. Technical Analyst : Malik Awais Source : Tradinglounge.com get trial here!  
    • GBPUSD Elliott Wave Analysis Trading Lounge British Pound/U.S. Dollar (GBPUSD) Day Chart GBPUSD Elliott Wave Technical Analysis Function: Bearish Trend Mode: Impulsive Structure: Navy blue wave 1 Position: Gray wave 1 Direction Next Higher Degrees: Navy blue wave 2 Details: Navy blue wave 1 remains active. Wave Cancel Invalid Level: 1.34351 The Elliott Wave analysis for the GBPUSD daily chart from Trading Lounge highlights a bearish trend in the currency pair, driven by an impulsive wave structure. The current analysis identifies navy blue wave 1 as ongoing, signaling a continuation of the downward momentum within the broader bearish framework. Currently positioned in gray wave 1, this impulsive movement suggests further price declines as the wave structure develops. The unfolding of navy blue wave 1 underscores the likelihood of sustained bearish pressure on GBPUSD, consistent with the broader trend direction. The impulsive nature of the wave structure indicates strong, directional moves, supporting expectations for additional downside. An invalidation level is set at 1.34351, representing a crucial point in the analysis. A price movement to or above this level would invalidate the current wave structure, signaling a potential reversal or the start of a corrective phase. Such an event would prompt a re-evaluation of the Elliott Wave analysis. Summary This analysis reinforces a bearish perspective for GBPUSD as navy blue wave 1 progresses within the impulsive structure of gray wave 1. Traders should closely monitor price action near the invalidation level of 1.34351. A break above this threshold may indicate a reversal or necessitate a reassessment of the wave structure, deviating from the current bearish trend outlook.   British Pound/U.S. Dollar (GBPUSD) 4 Hour Chart GBPUSD Elliott Wave Technical Analysis Function: Bearish Trend Mode: Impulsive Structure: Orange wave 5 Position: Navy blue wave 1 Direction Next Higher Degrees: Navy blue wave 2 Details: Orange wave 4 appears completed. Orange wave 5 of navy blue wave 1 is active. Wave Cancel Invalid Level: 1.30099 The GBPUSD Elliott Wave analysis for the 4-hour chart from Trading Lounge identifies a bearish trend in the currency pair, marked by an impulsive wave pattern. Orange wave 5 is currently unfolding as part of the larger navy blue wave 1, signaling continued downward movement. Following the apparent completion of orange wave 4, orange wave 5 has commenced within the impulsive framework of navy blue wave 1. Typically, wave 5 represents the final phase of an impulsive trend, reinforcing the bearish momentum and increasing the probability of further downside in GBPUSD. The analysis highlights a critical invalidation level at 1.30099. If the price moves to or above this point, the current wave structure would be invalidated, indicating a potential trend reversal or the start of a corrective phase. This invalidation level is a vital reference for confirming the bearish trend. A breach of this level could challenge the current analysis, necessitating a reassessment of the wave structure. Summary This analysis supports a bearish outlook for GBPUSD, driven by orange wave 5 within navy blue wave 1. Traders should closely monitor price movements near the invalidation level at 1.30099. Any rise above this threshold may suggest a reversal or a shift in the wave structure, impacting the overall bearish trend projection. Technical Analyst : Malik Awais Source : Tradinglounge.com get trial here!  
    • ASX: SCENTRE GROUP – SCG Elliott Elliott Wave Technical Analysis TradingLounge Greetings, Our Elliott Wave analysis today updates the Australian Stock Exchange (ASX) with SCENTRE GROUP – SCG. We are seeing a potential bull market with wave 3-grey of SCG.ASX, but it needs a little more time. ASX: SCENTRE GROUP – SCG 1D Chart (Semilog Scale) Analysis Function: Major trend (Intermediate degree, orange) Mode: Motive Structure: Impulse Position: Wave 2-grey of Wave (3)-orange Details: Wave 1-grey just finished, and wave 2-grey is unfolding to push lower, it could target around 3.40 – 3.28. If the 2-grey wave continues to push lower than the 3.14 level, it will call for a re-evaluation of the entire situation. Conversely, when the price pushes higher than the end of the ((b))-navy wave, it will suggest that the 3-grey wave is unfolding. Invalidation point: 3.14 ASX: SCENTRE GROUP – SCG 4-Hour Chart Analysis Function: Major trend (Minute degree, navy) Mode: Motive Structure: Impulse Position: Wave ((c))-navy of Wave 2-grey Details: Wave 1-grey has ended, and wave 2-grey is unfolding as a Zigzag labeled ((a))((b))((c))-navy. Now wave ((c))-navy is continuing its work to push lower, if price breaks 3.28 it will show that the Bear market weight is increasing, and I will review the situation then. Pushing above the end of wave ((B))-navy shows that wave 3-grey is ready to unfold. Invalidation point: 3.14 Conclusion: Our analysis, forecast of contextual trends, and short-term outlook for ASX: SCENTRE GROUP – SCG aim to provide readers with insights into the current market trends and how to capitalize on them effectively. We offer specific price points that act as validation or invalidation signals for our wave count, enhancing the confidence in our perspective. By combining these factors, we strive to offer readers the most objective and professional perspective on market trends. Technical Analyst: Hua (Shane) Cuong, CEWA-M (Master’s Designation). Source : Tradinglounge.com get trial here! #SCG #TradingLounge #ASXStocks #Stocks #ElliottWave  
×
×
  • Create New...
us