What is Requote in Forex Trading?
What is Requote, before we study it further you should first know the terms in forex. When you trade Forex, sooner or later you will definitely find the term “requote”. Although this term is not common, but you must be aware of its meaning, and know why you should try to avoid requotes.
WHAT IS REQUOTE?
Requotes in the Forex world mean that the broker you are dealing with cannot or wants to give you trading based on the price you enter. Generally this will happen in fast-moving markets. So basically, you have to decide to buy or sell currency pairs at a certain price and press the button to make a transaction. When your broker gets an order, the market will move too fast to execute the advertised price.
Requote announcements appear on your platform so you know the price has moved, and then give you the opportunity to decide whether you are willing to accept the price or not. Almost all the prices given are far worse than you requested. This is why leading brokers ask you to set prices first, before trading.
If you receive a requote, you will be explained that there is a price change when ordering and when the server receives it. This will definitely make traders less feel uncomfortable or suspicious of their broker. Requotes are part of the Forex trading experience, so you can reach them occasionally. When requotes occur in a quiet market and occur regularly, then it becomes a problem that needs to be noticed. If you are angry with frequent requotes, maybe switching to a broker is the right reason. Then, you can start looking for Forex brokers without requotes.It is advisable to use an ECN broker to avoid time lags that might cause re-requests. If your broker has an electronic communication network (ECN) it will reach a faster server which will reduce requotes dramatically.
WHAT CAUSES REQUOTES FOREX?
As mentioned above, the market usually moves very fast, but it can also move even more dramatically when the news is announced. This will make the broker difficult to order according to the price you requested. The brokers you face have their own brokers they face. The liquidity pool, or broker’s broker, can withdraw orders, raise prices, or even refuse to admit anything if they want it.
Experiencing requotes means that your broker cannot provide trading at the price they quote. If the reason for your requote is because the specific market is volatile and there are news announcements that affect the market that has begun to change, this is far more going in than the reason because your broker is abandoned in order when using technology.
HOW TO PROTECT YOURSELF FROM REQUOTES
Solid Forex brokers, easily protect themselves from requotes . By placing a limit order, you tell your broker that you are only willing to place an order at a certain price or better. By doing this, you can tell them beforehand if you are not willing to pay more for trading than this specific price, and you are willing to sit outside of trading if it cannot be done in this parameter.
Stop loss can be set before trading too. There are many types of stop loss and you can use according to your approach to trading and risk management.Automatic stop loss orders can be less efficient but are an option to consider.This can help prevent requester but will allow traders to stop hunting which is part of the risk.
The best market makers managed to limit the number and frequency of requotes even though they were in the area of the Forex market that was more volatile.They can connect to the most advanced technology and possible liquidity providers. As long as your broker prevents as many requotes as possible, you can give them the benefit of doubts and continue trading with confidence. That’s a little knowledge about what requotes you can get as new knowledge. You can also start learning other things like forex trading