If you are day trading futures and are only going for short term trades the best way to protect yourself against those spikes during news events is just to make sure you have no positions going into those releases.
That is what I do ...but...algo's can suddenly drive prices down on any day. That is why I use wider stops when scalping and scalpers are often upside down on R:R.
Sure, but those 90 points drop in NQ in seconds are usually only happen with news releases and price doesn't even trade at a lot of price levels, hence stops not getting triggered at the set price. If it's algo's pushing prices down fast you will still get a reasonably decent fill on the stop.
Yep those news releases can cause an imbalances on the books. But algo's can slam prices down fast too.
Based on my understanding, if the OP had a server-side stop, once the stop was triggered, the exchange should have automatically placed a stop-limit x-points farther out from the initial stop based on the protection points for the instrument he was trading. For NQ, I think the protection is set to 15 points farther out. It seems to me, that should have protected him from the extreme hit he took because that is what protection points are supposed to do. Check these links: https://support.tastytrade.com/support/s/solutions/articles/43000500621 https://www.cmegroup.com/education/protection-functionality-for-market-and-stop-orders.html https://cmegroupclientsite.atlassia...457087412/Order+Types+for+Futures+and+Options So why didn't that happen? https://cmegroupclientsite.atlassian.net/wiki/spaces/EPICSANDBOX/pages/457218368/Velocity+Logic As he was told, and as the above link indicates, when a Velocity Logic Event takes placed when the market is open, small orders and market orders are "eliminated," meaning canceled. This borders on insanity. The whole purpose of protection points is to protect you during extreme price movements, yet during extreme price movements, small orders and market orders (meaning small, retail orders) are canceled and you are left exposed. So why the fuck have protection points at all if they aren't going to protect you!? WTF?
If there aren't any contracts traded until 90 points lower then there are 0 available order types that are going to protect you from that. The is a very easy protection though, don't hold a trade into news. By the way, market orders aren't cancelled at all during extreme price movements, they execute at the best available price, which can be much lower or higher, as was the case here.
Hope you are right about that. Can you produce any info verifying what you are saying? A link? CME statement? Are you saying in his case it was just an extreme price move NOT related to the news? I though it was related to the news.