How to stop a trade of closing because of a spike?

[HeeraThakur]

When adding a S/L to a trade how can I exclude a spike from closing the trade in MT4? I want it to hit my S/L for at least 2 seconds or so before closing, not a 1 second spike.

I know there's also another way to prevent this by letting the price somewhat hover within a pricerange before taking the S/L but I don't know how this can be set up in MT4 as well...

 

[FXX]

the only way to achieve that would be an algo or some trade management tool that can do it for you. A stop is hard hard set as far as brokers are concerned so it is up to you to manage it, nothing they offer will help in that.

 

[NVP]

i suspect you cant ........

you cant have your cake and eat it

N

 

[trendie]

Interesting question.

1a: You need to write code to trigger a warning when price reaches a certain price. (pseudo-stop-loss).
1b: Then count X seconds before testing the price again, before triggering.
Downside is that if its a legitimate strong move against you, vital seconds are lost at a better price.

2a: Only check the price at the end of a bar. eg 1-hour bar.
2b: If the pseudo-stop-loss hits a certain price, you wait until the end of the bar. Only if price closes above/below it do you trigger stop-loss. If price spikes up, but at end of bar closes below, you ignore stop-loss. Vice-versa for downspikes.

Either way, you are trying to avoid fake outs.
But every little gained on one trade, gets balanced out with losses on the times you wish you got stopped out straight away.

Good question. Hope you find a solution.

 

[trendie]

Basically, you don't know if its a spike until after the fact, do you?

 

[hatemypips]

When adding a S/L to a trade how can I exclude a spike from closing the trade in MT4? I want it to hit my S/L for at least 2 seconds or so before closing, not a 1 second spike. Speed Test Scrabble Word Finder Solitaire

I know there's also another way to prevent this by letting the price somewhat hover within a pricerange before taking the S/L but I don't know how this can be set up in MT4 as well...

Do you have enough data showing strong evidence for spike reversal? This may be a risky setting

 

[FXX]

SPikes are caused by market makers, no way to stop them.

Actually it's the buy side not the sell side

 

[J_C_Anderson]

To avoid such events, you can try to write script (or the rule, if you trade manually) to close the position not when the specified level reached, but when the price holds on this level for several period. For example, "if the price is below 1.05 for 10 minutes, sell" instead of usual SL like "if the price is below 1.05, sell". You can check such rule in any backtesting software, in Forex Tester, for example.
Mid-term stock traders even have a rule, that says that they should sell falling stock only after the half an hour after the opening. It will help to save your position in case of V-reversal caused by broad market volatility.

 

[hatemypips]

When adding a S/L to a trade how can I exclude a spike from closing the trade in MT4? I want it to hit my S/L for at least 2 seconds or so before closing, not a 1 second spike.

I know there's also another way to prevent this by letting the price somewhat hover within a pricerange before taking the S/L but I don't know how this can be set up in MT4 as well...

You have to code EA for that or tie stop loss order to momentum indicator which is a ratio of the P(t) / P(t-1). You can pick the time step as 1 second and if momentum value higher than certain bar stop loss is not executed.