DislikedWhat about tradersway? Anyone having a nice straddle with them? Extremely high or very low spreads around news times on forex majors? Extremely high or less slippages on pending orders? Would appreciate if you specify the acct type, cos i'm looking @ their mt4.fix as well as ecn acct. Learned their cTrader seems good for news trading as well CheersIgnored
- #813
- Sep 4, 2013 4:53pm Sep 4, 2013 4:53pm
- Joined Jun 2009 | Status: FXCM Representative | 5,808 Posts
Hi guys. Great thread and thanks for all the useful input. Can anyone help... I have just started live straddle trading events. All my demo account tests perform really well using my own EA. Today I straddled 2 events: GBPUSD Construction PMI @ 0830GMT and EURUSD ISM Manufacturing PMI @ 1400GMT. Stop orders were placed well, but in both cases the price with FXCM jumped by around 150 points between ticks shortly after the events. FXCM filled the stop orders (in one case slightly better than the next tick beyond my stop order) but still way beyond...
Welcome to the forum
Just to clarify, when you say the price jumped about 150 points during PMI, that is actually a change of 15 pips. Such a price move is not uncommon during a news announcement.
Also, keep in mind that your order can only be filled at a price that is available in the market. If the market gaps through your order price during a news announcement, then your order will be filled at the next available price. Taking the example of your GBP/USD trade, one second the buy price was trading at 1.55828, and the next second the price had shot up to 1.55984. That's because once the positive information regarding PMI was released at 8:30 am GMT, all liquidity providers felt that an asking price 1.55828 was too low and none wanted to offer GBP/USD for anything less that 1.55984. If you had a stop order to buy GBP/USD at 1.55880, then it would have triggered, but since that price was never available for trading, the order would be filled at a higher price. This is an example of negative slippage because your order gets filled at a worse price.
On the FXCM platform, it's possible to for your orders to be filled at a better price too. That is called positive slippage or a price improvement. The stats below show that with FXCM price improvements are just as common as negative slippage on our platform. It's just that negative slippage is more common with stop orders, while price improvements are more common with limit orders. That has to do with the momentum of the price movement when the order is triggered. For example, if you had a limit order to sell GBP/USD at 1.55880 going into the PMI announcement, then the order would have triggered at 8:30 am GMT when the price gapped from 1.55798 up to 1.55934 and would have filled at a higher price with positive slippage.
http://img823.imageshack.us/img823/1...ovementspo.png
It's important to note that prices can move more dramatically during news announcements which increases the risk of both positive and negative slippage. This link has more info on how you can maximize positive slippage while minimizing negative slippage.
Jason
- #814
- Sep 4, 2013 5:10pm Sep 4, 2013 5:10pm
- Joined Jul 2011 | Status: Gold Again | 10,601 Posts
Hi guys. Great thread and thanks for all the useful input. Can anyone help... If so, I'm guessing everyone straddle trading would have struggled to make a profit today. Or is there a way to avoid this? Grateful for any insight on market jumps and advice on a better broker. Alan111s: I would love to hear your recommendation on...
Yes, you are only guessing, here is my trade on GBP PMI, no struggle at all except took long time to get 40 pips
And my broker is AxiTrader as recommended by Alan, I'm sure that is in thread here somewhere I read it
It takes a lot for me to IGNORE you, but you can try.
Hi Alan,
I Straddle traded AUD GDP on Wednesday and wanted to show you what is happening with the Buy side orders I mentioned earlier.
Settings:
CTBN = 3 | PointsAway = 50 (5 pips) | SecBAO = 3 | SecBMO = 1
From the below candle screen shot - 3 candle Low = 0.90375 | High = 0.90527
Log extract - last modify orders
2013.09.04 04:29:58 Sell Stop was @ 0.89325, changed to 0.90325 - perfect 5 pips from 3 candle Low.
2013.09.04 04:29:58 Buy Stop was @ 0.91639, changed to 0.90639
2013.09.04 04:29:58 Buy Stop was @ 0.90639, changed to 0.90656 - 12.9 pips from 3 candle High? Logically it should have been 0.90577.
So as you can see the Buy side order level when the spread is added, it's added to the High of the 3 candles which pushes it too far from the market price. The result is a high than wanted entry price. Add some slippage and the entry price can get a long way from where you'd want it. My entry price here was 0.90709.
If you can indulge me, could you run the EA and set CTCBN to something like 10 and watch the Buy side order level. It constantly changes even when the Ask price is within with candle range.
Appreciate your feedback.
I Straddle traded AUD GDP on Wednesday and wanted to show you what is happening with the Buy side orders I mentioned earlier.
Settings:
CTBN = 3 | PointsAway = 50 (5 pips) | SecBAO = 3 | SecBMO = 1
From the below candle screen shot - 3 candle Low = 0.90375 | High = 0.90527
Log extract - last modify orders
2013.09.04 04:29:58 Sell Stop was @ 0.89325, changed to 0.90325 - perfect 5 pips from 3 candle Low.
2013.09.04 04:29:58 Buy Stop was @ 0.91639, changed to 0.90639
2013.09.04 04:29:58 Buy Stop was @ 0.90639, changed to 0.90656 - 12.9 pips from 3 candle High? Logically it should have been 0.90577.
So as you can see the Buy side order level when the spread is added, it's added to the High of the 3 candles which pushes it too far from the market price. The result is a high than wanted entry price. Add some slippage and the entry price can get a long way from where you'd want it. My entry price here was 0.90709.
If you can indulge me, could you run the EA and set CTCBN to something like 10 and watch the Buy side order level. It constantly changes even when the Ask price is within with candle range.
Appreciate your feedback.
