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Stopped out even though price didn't actually reach the stop level?


Guest effortless

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Guest effortless

Hi All

 

I entered a short trade on NOKSEK last Friday 23rd March 22:14:07.

 

The history shows I was stopped out at 1.06629.  But when you look at the pricing action from the time I entered the trade to now, the pricing action didn't even go to 1.06629. The highest it went was 1.06620. 

 

So can someone please tell me why my trade closed at 1.06629 when pricing action didn't even reach that point? 

 

Thanks

Daniel

 

 

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  • 2 months later...

James you didn't correct me on the above reply. I've just been told when you are short it's the bid price you should be looking at. Please recheck this and reply with the correct answer. You should not allow people to give wrong advice to others. Thanks

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The charts will show either the bid, mid or ask. This is the sell (bid) price, the mid price, and the buy (ask) price respectively. 

The original question was referring to an open trade which was short and had an attached stop. Therefore you do need to look at buying back to close, and you do need to be looking at the ask price. The post you made was correct in this context and therefore you didn't need correcting.

I believe you may now be referring to the opening of a new trade? If this is the case and you have a working order to sell (which is different from this threads original query), then yes - you will need to be looking at the bid price. 

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Hi @Situation, it's not really surprising this one comes up so often as it's so easy to get spun around as you just found having given the correct answer first time then getting mixed up, I hope all my posts don't get vetted.

 

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

To get into a short you sell the bid. To get out of your short you need to do the opposite and buy the ask.

 

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No worries @Situation - that's exactly what the community is for! A bit of back and forwards chat, and any clarification where needed. We all get things wrong sometimes and it's very possible that I could have misphrased or misinterpreted something, so always call me / any other moderator or staff out on it if it's not expressly clear. 

Have a good day all ?
*mini fist pump*

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  • 1 month later...

Hi, I have a similar problem. I bought sugar at 1125 with a stop of 16 points... so it should only be triggered at 1109.  However, when I logged in this morning I found it was stopped at 1110. When I did a mouse over the last bar, it said lowest was 1110... so do you mean to say that the stop should actually be lower than 1109 to take into account the spread?

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Hi @CKau,  you were stopped out at 1109, you were long so your example is the opposite to the one above in this thread, so to get into your long you had to buy the ask and to get out (your stop) you had to sell the bid.

As you can see the bid price tagged 1109. So yes you do need to consider the spread and also bare in mind the spread can widen and narrow depending on volatility

bid1.thumb.PNG.ac173f5ae2dc7c778f26e5c5d4de617b.PNG

 

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Guest 202925
On 7/27/2018 at 1:43 AM, CKau said:

Hi, I have a similar problem. I bought sugar at 1125 with a stop of 16 points... so it should only be triggered at 1109.  However, when I logged in this morning I found it was stopped at 1110. When I did a mouse over the last bar, it said lowest was 1110... so do you mean to say that the stop should actually be lower than 1109 to take into account the spread?

Thanks for playing CKau

 

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Guest crispy4747
On ‎3‎/‎25‎/‎2018 at 10:56 AM, effortless said:

Hi All

 

I entered a short trade on NOKSEK last Friday 23rd March 22:14:07.

 

The history shows I was stopped out at 1.06629.  But when you look at the pricing action from the time I entered the trade to now, the pricing action didn't even go to 1.06629. The highest it went was 1.06620. 

 

So can someone please tell me why my trade closed at 1.06629 when pricing action didn't even reach that point? 

 

Thanks

Daniel

 

 

 

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