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Video 15G Slide 15
In aformentioned slide, there's a quote I don't understand. Why does market have to go down 11 pips, instead of only 10 pips to scale in 10 pips lower?
If the chart displays Ask-price: suppose our first Buy is a Limit Order at 1.0680 (Buying always takes place @ Ask price, so 1.0680, not 1.0679 which is Bid-price at that point).
Second Buy / scale in Buy, would be 10 pips lower so at 1.0670, also via Limit Order (again Buying takes place @ Ask price, so 1.0670, not 1.0669 which is Bid-price at that point).
So first Buy when market is @ 1.0680, and second Buy when market is @ 1.0670. 10 pips price move.
Thanks in advance for shedding a light on my problem.
Most limit orders will not be filled when the MKT reaches exactly 10 pips because there will be so many of them at that price level. Therefore for all of them to be filled the MKT has to go one more tick, so 11 ticks.
Okay. I'll write that up ;).
Thanks a lot!