Gaps and limit/stop orders

Oct 05, 2017 at 07:23
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4 Replies
Membro Desde Apr 12, 2017   1 posts
Oct 05, 2017 at 07:23
Let's say I set a limit or stop order at a certain price - and there is a gap that overlaps the price - does the trade activate?
mishumo@
Membro Desde Feb 12, 2016   427 posts
Oct 05, 2017 at 14:35
Yes. Your trade will be activated because the open price AFTER the gap will already overlap your limit. Doesn't matter that the price went up/down because of a gap.
Accept the loss as experience
Membro Desde Aug 21, 2017   12 posts
Oct 06, 2017 at 09:29
You write a simple piece of code will prevent that on MT4
Membro Desde Aug 20, 2009   266 posts
Oct 06, 2017 at 10:06
Actually, don't count on it for a limit order. Stop order, no question......along with consequent slippage.

The price you see on a chart is the Bid price, so if you have a buy limit order(pending order at below market price), you may have the bid price open up with a gap well below your target price......typically gaps are caused by poor weekend liquidity(which also causes big spreads) and there is a chance that the Ask price(which is the price your order needs for a buy) may still be above your order price.
Wealth Creation Through Technology
Membro Desde Feb 12, 2016   522 posts
Oct 11, 2017 at 15:06
It should be on the first available market price. In some brokers MM you may see nice execution in the gap :)
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