Don't understand forex stops

[Brakkar]

Hi,
my broker is FXCM micro, and while on their trial, I tried their simulation, placed short orders, and a stop which I manually trailed.

EVERY TIME the stop got triggered well before the price went back to its level.

Is there something i'm missing ? I heard that I should include "the spread" in the stop value only when I short..... Is this the problem ?

Thanks,
Brakkar

 

[foredog]

By well before do you mean 2 pips of 25 pips, if it's 2 then it's the spread, if 25...dunno

 

[Magos]

Hi,
my broker is FXCM micro, and while on their trial, I tried their simulation, placed short orders, and a stop which I manually trailed.

EVERY TIME the stop got triggered well before the price went back to its level.

Is there something i'm missing ? I heard that I should include "the spread" in the stop value only when I short..... Is this the problem ?

Thanks,
Brakkar

Lets make it easy

Short order => you sold a currency pair
Stop order=> execute when market reaches a level under the current market price
Stop order doesn’t guarantee that the currency pair will rally(go even further down). It might go up again. Try to work on your levels ( i.e. buy stops: where you should buy / sell stops: where you should sell and Limit orders)

There is nothing missing, the only think that is missing is that FXCM might give you slippage if you get your stops right ( fill you in a worse price than what you asked)

Some companies will only allow you to place stops bigger than the spread:

Example: EURUSD 1.2539-41 (2 pips spread)
Sell Stop: 1.2537
Buy Stop: 1.2543

There is no problem


Magos

 

[Brakkar]

ok, tks Magos.