[MY VIDEO] What mistake I made here?

[lightsun47]

Here's my own recorded video:

YOUTUBE LINK

I tried to do an OCO order but couldn't get filled at all.

Once I'll get input from you guys, I'll let you know what Ninja Trader support emailed me regarding this issue.

Thank you.

[NinjaTrader_RyanS]

Hello,

Thanks for including the video.

In this particular example, the market suddenly dropped on heavy volume, and since you were using stop limit orders, the price of your limit was likely not available as the market dropped through your stop order.

If you want to guarantee a fill of your order (but not guarantee a fill price), you would want to use a stop market instead of a stop limit.

To change this, right click the superdom and go to properties. Here enable the option "Middle mouse button is stop market".

Please let me know if you have any further questions.

[lightsun47]

Thank you for your reply.

If I try stop market, chances are still more or just slim in getting filled in those conditions?

Logically, if I called an elevator at 50th floor to go down on the ground floor, (here) your elevator went straight down (STRAIGHT) without even stopping anywhere to pick me up.

My question is, will Ninja Trader be able to do *something* about these kinds of situations in the future where there can be a guaranteed fill?

I've already got multiple responses from the support team indicating the market conditions, slippage, volatility, etc. are not in our hands, but still, NT is a continuously evolving platform and needs to do something regarding this.

[NinjaTrader_RyanS]

Hello,

Thanks for the reply.

Using a stop market order will guarantee your stop is filled, but it doesn't guarantee at what price it will be filled. This is the nature of stop market orders, and is not dependent on any platform or brokerage you are using.

Orders are filled based off of your approximate position in the queue at the exchange where the order resides. For instance, if the market of CL is at 50, and you have a stop market at 49.95, and your approximate position in the order queue is 101, the following could happen:

Price suddenly drops through your stop loss, and no one is willing to buy until the 49.80 level. Therefore no one's sell order is filled until 49.80. Let's say 50 buyers are available at 49.8, so the first 50 in the order queue are filled at that price. Then the next 50 will be filled at the next best price where buyers have orders, and then your order will be filled at the best available price.

In the above example, a stop market order of 49.95 may be filled at a price significantly below your stop price, as that would be the best available price.
If you would have had a stop limit order, with a stop price of 49.95 and a limit price of 49.90, your order would not be filled, as there was no one willing to buy at your limit price (or better) of 49.90.

This occurs in markets usually wen binary events occur, or any other factor that causes a sudden and immediate move in either direction. In CL particulary, inventory reports often cause these kinds of moves.

Please let me know if I may assist further.

[lightsun47]

Price suddenly drops through your stop loss, and no one is willing to buy until the 49.80 level. Therefore no one's sell order is filled until 49.80.

I understood you, but let me ask again for confirmed clarification:

If the price suddenly dropped, I did not get filled because there were no buyers before 49.80, correct?

In a broader sense, I was wondering why price did not get filled in the first place even though it did move through 49.95 (or whatever price I placed the limit order).

Doesn't the price has to get filled up even if it moves straight through?

Thank you.

[NinjaTrader_RyanS]

Hello,

Since your order was a stop limit order, there is no way to guarantee the order is filled.

It's unclear what the limit price was in your scenario, but the stop price was 49.40. The price was hovering around 49.50, and then dropped immediately to the 49.20-.25 area. If your limit price was above that area, 49.38 for instance, it would not be filled.
The limit price sets a 'limit' of how 'bad' of a price you will accept. Assuming your limit price was 49.38, this means that 49.38 is the lowest price you wish to sell at. Since the price dropped straight below this, this price was not available and therefore your order was not filled.

I've provided a link to a publicly available external resource about stop limit vs stop market orders that may or may not be helpful to you.

https://www.thebalance.com/stop-loss-orders-market-or-limit-1031053

Please let me know if you have any further questions.

[sledge]

I understood you, but let me ask again for confirmed clarification:

If the price suddenly dropped, I did not get filled because there were no buyers before 49.80, correct?

In a broader sense, I was wondering why price did not get filled in the first place even though it did move through 49.95 (or whatever price I placed the limit order).

Doesn't the price has to get filled up even if it moves straight through?

Thank you.

You can buy as much as you like on the ride down to 0. Those will always get filled!

[lightsun47]

You can buy as much as you like on the ride down to 0. Those will always get filled!

I didn't get it. Can you please elaborate? Thank you.

[Dolfan]

I think what you are not understanding here is latency in trading. When a news events occurs and price flies up or down, current orders on the books will indeed get filled first and immediately. You order is not yet on the books. It is in fact waiting for a trigger signal based on your trading strategy. Price moves and orders filled happens in milliseconds. The latency comes between the time your strategy recognizes the trigger and sends an order to the exchange. By the time your order becomes "on the books", price may well have moved beyond where you you would like for your entry to take place. If you choose market orders, they will fill at whatever price the market is at when the trigger reaches the exchange and the order is on the books. This is known as slippage. If you choose a limit order, your order will only fill at the price for which you dictate. The difference between the 2 can be catastrophic.

Making trades based on news events is very risky. Choose limit orders and if your price is missed, you lose nothing. If it hits, you're in the money. If you choose a market order you will likely suffer slippage with a worse entry than you care to accept. You may also suffer a whipsaw which will drastically reverse the price action and hit your stop quickly. Better to choose a limit order and miss while waiting for the market price to come back to you.

Hope this helps.

Dolfan

[NinjaTrader_RyanS]

Hello,

The root issue of the order not filling is the use of the stop limit order instead of a stop market order. Limit orders will guarantee your price, and market orders guarantee a fill. Which you choose to use will be up to you, and can be edited via the instructions below.

In your scenario, it comes down to the market gapping below your sell stop order, and you know have a limit sell order in at a price that is above the market.

Please let me know if you have any other questions.