That Spike took around four Minutes to move from 1295 to 1365. But as Spike500 rightly pointed out, these movements are very rare and you are in more Danger accidentaly getting a fill on a 10x Size Order and then the ISP going down than being on the wrong side of a 50 Point Move. But i builded that into my Trading System and reduced my Size. Btw the big Spikes are always up not down. The Downmoves in this tiny Intraday-window take much longer and Stops could save you here but with nonnative and maybe even with native Stops, you would have been executed above 1350 i guess. In volatile times when market jumps 10 Points, the Orderbook gets pretty thin and mainly stops are left. Who is going to fill your Stoploss then?
What exactly do you mean by that, are mental stops better than (non-)native stops ? Greetings, Marsupilami
Stops are not allowed for ES and Marketorders are also not available. When you place a Stop for ES, they are Simulated by your Broker. If a Spike occures, the Brokers System will be lagging the bigger the Vola is. You can also place a Stoplimit Order with max. four Points away from current Price but if there are Stops from others before your Stoplimit in a very thin Market, you might never get a Fill with your Limitorder. If ES spikes, a Stop, be it Simulated by your Broker or a native Stoplimit at Globex, will be difficult to get filled because Bid/Ask may be 10 Points wide. Then count in the Tons of inexperienced HedgeFunds the last couple of Years trading mainly the Indexfutures and not the underlying Stocks and there is the Receipt for Long Bars. If you look for correct Leverage i would say a 50 Point Move in ES should not destroy more than 25% of ones Account.
And God may decend from the heavens and quintuple your trading account. Both of these things are theoretically possible, but I wouldn't trade as if they had a chance in hell. A 10 point spread on ES during RTH is about as common as unicorns goring drunk Irishmen like myself. And even if it were, I bet if you split the spread, you'd get a quick fill. FB's right that Globex doesn't accept stops or market orders (last time I checked, anyway). But during RTH, ES doesn't seem to gap up or down for points at a crack. Although this next week might be interesting due to low volume. Must be time for some more whiskey. Hmmm, is that a horse I hear galloping towards me?
Hm, maybe I really should do some serious studying. I always thought that stops in the ES were native, i.e. in the Globex system. I know that with the Cbot, this is not the case, so if you are trading the YM and the brokers's software goes down, you're in trouble. Same thing for ES now ?