Spread question

[Matt Houston]

I am almost embarrassed to ask this.

How do I adjust my orders in order to take the spread into account?

For example, if I am looking to go long, have a spread of 2 pips and want a stop loss to be triggered at a price of 100, if I literally place a stop of 100 it will be triggered at 102 right?

So should I place stop loss at 98?

What about the stop to open the order?

I was using a demo account and my trade got triggered even though on the chart the price didn't even reach the required level.

 

[Lord Flasheart]

I am almost embarrassed to ask this.

How do I adjust my orders in order to take the spread into account?

For example, if I am looking to go long, have a spread of 2 pips and want a stop loss to be triggered at a price of 100, if I literally place a stop of 100 it will be triggered at 102 right?

So should I place stop loss at 98?

What about the stop to open the order?

I was using a demo account and my trade got triggered even though on the chart the price didn't even reach the required level.

your thinking too much, if you look at the price you get on entry and then take off 100 that will give you a stop of 98,so for 100 it should be 102. Same with stop to open,just take of 102 of your entry price and it will be 100. The charts will generally show a mid price so the spread will be on top off that. Most spreads are attached to the top of the price so it will reach the price just before the market does

 

[Matt Houston]

OK, so let's say I wanted to place the below orders

Entry stop @ 110
Stop loss @ 100

With a spread of 2 I would enter the below:

Entry stop @ 112
Stop loss @ 102

Correct? And then I assume it's reversed for shorts?

 

[Lord Flasheart]

OK, so let's say I wanted to place the below orders

Entry stop @ 110
Stop loss @ 100

With a spread of 2 I would enter the below:

Entry stop @ 112
Stop loss @ 102

Correct? And then I assume it's reversed for shorts?

in that scenario you would lose 10 pips,2 for the spread an 8 for the movement

 

[Matt Houston]

Cool.

It's one thing being stopped out for more pips than planned, but even worse when it's on a trade which should never have been executed. So hopefully adding the spread to the required price will take care of that.

Thanks for the help.

 

[scose-no-doubt]

If you go long then you'll go in at the ask price which will be lower than the bid and you'll pay two spread. As you're now an owner, your profit/loss will be determined by the ask price so pull up an ask chart and set your stop using that and don;t forget you're gonna need to account for another 2 spread i.e. if your stop is at 100 then when the ask hits 102 you're gobbled up. It need to be 98.

Obviously this works on the flip side too when you're shorting, dread.

bye bye, love.

 

[Matt Houston]

OK, I've got it. Thanks, and bye.