Minimum Buy Limit Distances
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I know that minimum stop distances have been discussed several times on here and the problem of orders not being placed or strategies stopped if a stop order is sent to market too close to current price but I was wondering about minimum distances for BUY LIMIT orders. Can you place a buy limit order too close to market price and it be rejected?
There is current stop distance info on the IG platform but nothing for limit distance. Does this mean there is no minimum distance?
The reason I ask the above question is because I am working on a strategy that works on daily candles and places a limit order to buy and to sell. In back testing the buy orders are all working fine and 99% of the sell orders are working fine but just occasionally it seems that a sell order is missed.
Here is an example:
The little blue arrow is the buy which is 5 pips below the sell limit order price which is supposed to be at the close price of the candle before – but it does not sell there and stays on the market all day and sells at the close of the candle/open the next day which is the second exit for the strategy if the target has not been hit during the day. It is as if the SELL LIMIT order is not placed in the back test. In this example is was actually more profitable not to sell but that is not the point!
Here is an example of it working as it should in the same back test:
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