Broker Stopped Out What should I do in this situation??

[pboyles]

I think what you have described is a 'market if touched' or MIT order. In any case it's somewhat irrelevant as they would probably have taken you out regardless.

 

[bigboy]

Hi bigboyssupplements....are you my brother?

 

[ns1000]

A stop order is an order to sell/buy at the market once a certain price is reached. So for instance in this situation once the BID reaches .84909 the broker would fill your order 'at the market'. That price high on the chart of .84891 (indicative as already mentioned) is the mid price at that moment. What would the bid have been then? Spreads are upwards from around 3 pips for the Aussie and your platform is showing five decimal places (the fourth decimal is the whole pip value), so I would say the bid would have touched that level.

As mentioned stops involve market orders, so theoretically it is quite possible to have positive slippage. There could be a handful of trades at that top however once your stop was triggered market price could have started slipping back before execution. That said, in your case it doesn't look like this happened, its just normal execution with the effect of the spread.

What can be done to avoid this? Well your stop levels need to take the spread into account. Also that level could be said to be a popular level for stops - you'll see in the PA that traders probably put even more stops at that level 'above resistance' which is why price popped up there again in the afternoon. Perhaps avoid those obvious spots. You could trade futures (if you've got more funds) where the market is open and you won't have a broker taking the other side of your trade, and knowing where your stops are. For short term trading though that is of limited value - at the end of the day any short term trader with experience would know that level was a good one to target for order flow, and at the end of the day thats what makes money for bank traders, brokers and successful short term traders. Its all part of the game!

No, he was short, so it's the offer that's important.

I don't know whether his stop is based on mid price, or offer, but either was he can't be filled below his stop. If that's where the market is, the stop shouldn't be triggered.

Despite what some posters believe, SB companies play by the rules on stop for the main part. There are some shonky outfits, but in this case the OP has a case and needs to complain. You can't be filled on a stop buy below your stop.

 

[vizatelli]

Have I read that right - you were short with a buy stop at 8490.9, and you've been filled at 8489.1. Definitely complain - how can you be filled with positive slippage on a stop? It's a stop, not an If Touched order.

Actually NS1000, you really do not know how any markets function, do you? If a stop gets triggered (if you are short) and the market goes above your stop level, if the company you are trading with (a SB company I suspect) takes a while to fill you and by the time they do the market is below your stop level again they will fill you there. This does not mean they will leave your position running as I expect you will say. In any market once a stop order is filled it becomes an "at market" order, which means to fill at any price no matter where the market is.

I have looked at the majority of your posts and it seems to me that you have no market experience what so ever and should not be on these message boards giving your ridiculous comments. Get back to your filing job or whatever it is you do. Im quite sure I know who you are and you really shouldnt be on here.

 

[William Waller]

BBS,

You sold with a stop loss at 8490. Your stop is therefore a buy order (to close a sell you have to buy) so it will be executed when the offer price hits 8490.

The price on your chart is probably the mid price. So if the chart shows a price of 8489 the offer price at that time for this pair will be half the spread (1.5 to 2 pips usually, the full spread being 3 to 4 pips) higher.

If the chart is showing a mid price of 8489 buy orders placed at 8491 are going to get hit, assuming a 4 pip spread. That seems like the most likely explanation to me - it doesn't sound like the broker has pulled a fast one.

On a wider point, if a pip or two like this is going to make a big difference to you, you need to reconsider you chosen method.

 

[ns1000]

Actually NS1000, you really do not know how any markets function, do you? If a stop gets triggered (if you are short) and the market goes above your stop level, if the company you are trading with (a SB company I suspect) takes a while to fill you and by the time they do the market is below your stop level again they will fill you there. This does not mean they will leave your position running as I expect you will say. In any market once a stop order is filled it becomes an "at market" order, which means to fill at any price no matter where the market is.

I have looked at the majority of your posts and it seems to me that you have no market experience what so ever and should not be on these message boards giving your ridiculous comments. Get back to your filing job or whatever it is you do. Im quite sure I know who you are and you really shouldnt be on here.

Thanks for the benefit of your advice. You really have a talent at humour. Very good. If you'd read the thread rather than posted out of ignorance you might have seen that the price on his chart didn't go above the stop level, so either it shouldn't have been filled or it should have been filled at a higher level.

I have no idea why you want to make enemies on this board, but please leave the personal abuse out. You know what I do for a living, so what's with the attitude? You've clearly got a problem with spread betting as a whole - or one company in particular. As for whether I should be posting - why not? I've never denied that I work in the industry, but what I have is a dozen years experience of how it works, which -as in this case- can help newbies. Perhaps you should come clean about your bias too, rather than hiding behind a poorly constructed veil of 'my friend told me...'

 

[Shikamaroo]

In response to the original question. I have seen it happen on MT4 that if the price is spiking down the lowest point that is seen on the tic chart where you place orders was not the lowest point posted on the chart. I only saw it once but maby that is what happened.