What is Slippage?
Slippage is a core concept in currency trading.
The difference between the expected execution price of an order and the actual price at which the trade is filled in the interbank market.
Understanding Slippage helps you manage your risk and spot high-probability trade setups.
Why It Matters for Forex Traders
In forex trading, Slippage helps you protect your capital. It gives you a clear rule to follow instead of guessing.
How to Identify and Apply Slippage
- 1Spot and mark Slippage on your chart during active trading hours.
- 2Check that the overall market trend agrees with your trade idea.
- 3Always place a protective stop loss before entering any position.
Practical Forex Example
For example, on a EUR/USD trade, applying Slippage allows you to set clear entry and exit points before risking real money.
PRO TRADER TIP
Always test strategies involving Slippage on a free demo account first before trading with real capital.