I felt the need to address requotes on a separate page that will continually be visible long after a blog post has cycled to the bottom. It seems to be the single most widespread problem facing spike news traders today. It could probably be solved on your present broker by doing the research listed below, but if not, this site/blog will tell you what to do to get execution on news trades.
There is a misconception among traders that somehow, when they use an autoclick on a news trade, that by the time their order got to the broker's server, the price had already moved so far away that to accept a requote would be a very bad idea. Although you see a graphic depiction of a candle originating at one price, and moving through every price up the spike, the truth is that most of the prices along the way are not available.
Traders began to lease remote servers in New York to host their dealing stations, so they will get the news to their autoclick in 0 milliseconds. Does it work? Sure does. Do you need it? No.
Getting the order to your broker server is definitely a job for the autoclick, but after it gets there, it is totally out of our hands. Any autoclick is sufficient to get the order in at the beginning of the spike. The broker we are using is currently executing on the best bid/ask price available through their 10 banks of liquidity. A broker is, by definition, the middle man. Our broker is quoting the best price available from all their 10 banks.
Here is something each of you can check on your current broker to see why you are being requoted:
From your start menu, click on My Computer< Local disc C< Program Files< (your own)MT4 broker< logs.
On the logs page you will see a archive, saved in notepad, of all the dates on which you took a trade. Pull any old news trade on which you were requoted. For my example, I will use UK CPI traded on Crown Forex on GBPUSD on June 19, 2008. The log files are as follows: Don't worry about the time stamp. It is generated by your computer clock and may or may not match the atomic clock used by the news trade.
04:30:07 '14389': instant order buy 10000.00 GBPUSD at 1.9631 sl: 0.0000 tp: 0.0000
04:30:07 '14439': instant order buy 10000.00 GBPUSD at 1.9631 sl: 0.0000 tp: 0.0000
04:30:07 '14447': instant order buy 10000.00 GBPUSD at 1.9631 sl: 0.0000 tp: 0.0000
04:30:08 '14439': request was accepted by server
04:30:08 '14447': request was accepted by server
04:30:08 '14389': request was accepted by server
04:30:08 '14439': request in process
04:30:08 '14447': request in process
04:30:08 '14389': request in process
04:30:10 '14439': requote 1.9648 / 1.9649 for open buy 10000.00 GBPUSD at 1.9631 sl: 0.0000 tp: 0.0000
04:30:10 '14447': requote 1.9648 / 1.9649 for open buy 10000.00 GBPUSD at 1.9631 sl: 0.0000 tp: 0.0000
04:30:10 '14389': requote 1.9648 / 1.9649 for open buy 10000.00 GBPUSD at 1.9631 sl: 0.0000 tp: 0.0000
I used a slippage control of 15 on this release and was requoted.
THIS IS IMPORTANT: Look at the price at which my order arrived at the broker server.
This lets me know that my autoclick has done its job. I didn't need a remote server. I show on average 23 milliseconds before each release.
So what do we know? We know I clicked in at the beginning of the spike as evidenced by 1.9631 being printed in the logs. We also know that Crown was not able to offer me ANY price between 1.9631 and .19649 because within 2 seconds Crown's automatic execution replied back to me that "the best bid/ask price available is 1.9648/49. Do you want it? I had already answered that question with my slippage control. I had told them to execute my order up to 15 pips away from that 1.9631 price, but if you can't, don't execute it at all. At newstime, the banks behind Crowns price feed have widened their spread as well. In the above example, they widened it 18 pips. If I had put in 20 as slippage control, I would have been executed.
If you have been following along on your own MT4 broker log, you would know how far out you are being requoted and would know how to adjust to make the trade execute instead of requote. If your "click in" price is showing on your log, and it is way off from your requote, you are looking at a huge underlying spread being put there by your broker's liquidity provider. The conclusion you should draw is, that your autoclick has done its job and your order is there at the beginning of the spike. You should also not get mad at your broker (remember he is just a middleman) because he is just displaying the best bid/ask price available to him by his liquidity provider. You should consider leaving this broker if the spread is constantly more than you would be willing to place as slippage control on any given news trade.
I have seen execution at Crown with no spread on up to the 18 pips discussed above. I am still in the process of getting a feel for where their providers are setting their spreads. As long as we are using minilots, we bypass the desk and get automatic execution, and so far, from my observations, I don't question that. I believe that is what we are seeing. If you duplicate the client.exe you can trade multiple instances of your dealing station while they are minimized. Trade 10 stations of .9 lots each and you are getting the equivalent of 9.9 lots through on automatic execution without going through the desk.
Here is one more example I will leave you with:
04:30:02 '14439': instant order buy 10000.00 GBPUSD at 1.9658 sl: 0.0000 tp: 0.0000
04:30:02 '14389': instant order buy 10000.00 GBPUSD at 1.9658 sl: 0.0000 tp: 0.0000
04:30:02 '14447': instant order buy 10000.00 GBPUSD at 1.9658 sl: 0.0000 tp: 0.0000
04:30:03 '14447': request was accepted by server
04:30:03 '14439': request was accepted by server
04:30:03 '14447': request in process
04:30:03 '14439': request in process
04:30:06 '14447': requote 1.9668 / 1.9669 for open buy 10000.00 GBPUSD at 1.9658 sl: 0.0000 tp: 0.0000
04:30:06 '14439': requote 1.9668 / 1.9669 for open buy 10000.00 GBPUSD at 1.9658 sl: 0.0000 tp: 0.0000
I used slippage control of 8 and was requoted. My order got there at 1.9658. It was accepted and in process within the same second, and requoted 11 pips out. It exceeded my slippage control by 3. This requote was the first price available, and in hindsight, would have been profitable. This was an early trade with Crown and I'm still trying to optimize the best slippage control.
Put it in perspective:
You are trading a rate announcement. Using a trigger of .25, if there is an unexpected rate change, you can expect 100 pips of price movement. It would obviously be ok to set a slippage control of 25.
Now, you are trading House Price Index. No matter what the trigger, its not likely to go 100pips, or even 25 pips, so the only safe thing to do is lower your slippage control and raise your safe trigger to enter the trade.
Understand your requotes. Don't get on a review site and complain. Don't take other traders reviews of a brokers actions at newstime as a fact. If the gap is rediculous, change brokers. If its not, adjust your slippage control. Know the rules, use the software to either piggyback or manage your lot size. There is no reason not to successfully spike trade and make money.