help on order type

[jjanguda]

Hi,

I have a question on order type - stop limit order and its offset setting.


I am expecting a major breakout movement at a major support/resistance level.
I'd like to catch some of its movement but want to limit my possible slippage.
For example, I want to place buy stop limit order on ES at 3000.00 level expecting a spike up movement.
But I'm only interested in 5 tick or less slippage. Otherwise, I don't want my order to get filled.


Question 1.

In order to achieve this, can I simply place buy SLM at 3000 with offset 5?



Question 2.
The worst possible entry will be 3001.25 (5 ticks from my buy SLM placed)?


Question 3.
Let's say that current ES price is 2999.75 and it moves 4 ticks at once (from 2999.75 to 3000.75).
It went through my BUY SLM at 3000. Then, this BUY SLM would become buy limit.
the next available price is 3000.75 while my buy limit is sitting at 3000.
Since 3000.75 is within 5 tick offset (only 3 ticks from my buy limit at 3000), my order will be filled at 3000.75 even though price never came back to 3000 to hit my buy limit order?



Question 4.
If price moved 10 ticks at once from 2999.75 to 3002.25, only my buy SLM becomes buy limit without getting filled and it will be sitting until price comes back within 5 tick range?


I'm trying to understand how offset really works on a fast move market.
I would appreciate your support in advance.

Thank you.

[NinjaTrader_Marco]

Hello, jjanguda,

Thanks for posting to the forums.

When you use an offset, this gives you a greater chance of getting filled, because this gives more than one price to the market assisting in quick moves.

Assuming the offset is +5 and 1 contract traded, a limit order for 1 contract is entered 5 ticks above the market if you are buying, so that is your worst fill.

If the market hits your stop price and immediately pulls back as the limit enters, it is possible to have a position better than your stop price , this is liquidity dependent so more likely in NQ than ES.

Please let me know if I may be of any further assistance.