Price slippage happens when your trade executes at a different price than the one you requested. It can occur on market orders, stop losses, and even take profits—especially during fast markets. This guide explains why slippage happens, when it’s most common, and practical ways to reduce its impact.
Slippage is not a “bug” by default—it’s a natural result of how markets match orders. If price is moving fast and there isn’t enough liquidity at your exact requested price, your order can fill at the next available price. That difference is slippage.
Example: the order triggers at a level but fills slightly beyond it during a fast move (replace this image later).
Price slippage explained
Slippage is the difference between requested price and executed price. It can happen on entries and exits, including stop loss triggers. In general:
- Negative slippage: your fill is worse than expected (costs you money).
- Positive slippage: your fill is better than expected (helps you).
Slippage is often measured in points or pips, depending on the instrument. On fast spikes, slippage can be small (1–3 pips) or large (10+ pips) depending on liquidity and speed.
Why slippage happens
Slippage usually comes from a mix of market conditions and execution mechanics. The most common causes are:
- High volatility (news, spikes, breaks).
- Low liquidity (rollover, holidays, off-hours).
- Gaps (weekend open, major events).
- Spread widening during uncertainty.
- Market/stop orders require immediate matching.
- Not enough volume at your exact price.
- Latency (network + server distance).
- Order size too large for current depth.
Important: slippage and spread are different. Spread is the bid/ask difference before you enter. Slippage is the fill difference that happens during execution.
Where slippage shows up (order types)
Slippage can happen on multiple order types, but the risk is not equal.
Highest slippage risk. A market order fills immediately at the best available price. If price moves quickly, your fill can be worse than expected.
Very common during spikes. Stops usually convert into a market order when triggered. If price gaps or accelerates, the stop can fill beyond the stop level.
Usually less noticeable, but possible in extreme conditions. Fast moves can cause a TP to fill slightly past the target.
A limit order controls price. It should only fill at your price or better, but it might not fill at all if price touches quickly and liquidity is thin.
How to reduce slippage
You cannot remove slippage completely, but you can reduce it with better timing, execution choices, and risk planning.
- Use limit orders for planned entries instead of market orders.
- Avoid major news windows (CPI, NFP, central bank rate decisions).
- Trade during liquid sessions (London/NY overlap for FX).
- Reduce position size during volatile conditions.
- Avoid trading right at rollover if your broker widens spreads.
- Prefer liquid instruments (majors) over thin/volatile symbols.
If your strategy depends on tight stops (scalping), slippage matters more. If your strategy uses wider stops and targets, slippage is usually less damaging (but still important).
EA and automation tips (MT4/MT5)
If you run EAs, slippage and spread spikes can break performance fast. Add simple protection rules so the EA avoids “bad market conditions.”
- Max spread filter (skip trades if spread is too wide).
- Max slippage/deviation setting.
- News-time filter (disable around high-impact events).
- Retry logic with a limit (avoid infinite loops).
- Prefer limit entries for planned levels.
- Use wider stops if market is fast (with smaller size).
- Validate symbol trading mode and session availability.
- Log real slippage for analysis (expected vs filled).
Even with protections, slippage can still occur on stops during gaps. That’s why using conservative leverage and realistic risk limits is important.