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GBPCAD Spreads

Hello …

I will start off by saying this is not a criticism, but a real concern I have. I am raising this because I would like to think it’s something that can be improved on by Darwinex. I think Darwinex kicks ass in many areas, but spread is unfortunately one area that I feel can do with some improvement.

Please also don’t confuse this message of mine as someone who is trying to take a scalping trade (as many of you know I have a history in scalping). I am in fact considering taking a trade with a pretty large stop on the GBP/CAD pair, however, I just do not feel I can justify paying 25 pips in spread for me to take the trade.

I realise the market has opened only 40 minutes or so ago, but still, spreads this wide would make it quite tricky to trade the best of strategies. I also stress that I appreciate that GBP/CAD is hardly well known for it’s exceptional spreads.

15 minutes after market open the spread on this pair was still 40 pips.

I would therefore like to ask what can be done to improve this? My intention is not to start comparing brokers, so it’s really a case of asking what can Darwinex do in this area? I guess the spread is being passed on by the LPs as the difference between the bid/ask prices, however, I assume there are opportunities in the form of aggregated liquidity etc?

I would be keen to hear others’ experiences, and also from Darwinex on whether there is something in the pipeline to improve a little here?

We are now 50 minutes into market open and back up to 32 pips as shown below.

Cheers

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Hi @TheMarketBank
Thank you for pointing this out.

As you probably know, or have observed over time, if the market is “tradable” at 21:05 on Sunday, doesn’t mean that you will have full liquidity. Liquidity always appears starting from 22:00 GMT (dst on). This is something you can observe for years now, on nearly all brokerage, and not something new.

21-22 is a kind of a ‘dead hour’,

What about the spread after 22:00?

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Thanks, and yes I know exactly what the spreads typically do around this hour - but 40 pips is massive and spreads this wide has potential for stopping out all kinds of strategies in my opinion. I deliberately stated in my initial post that I didn’t want for this to become a thread of comparing brokers, but as you have brought it up, No, spreads this wide is not normal.

Edit: To add to my post, it doesn’t help to say the spreads are better after 22:00 - some consideration should also be given to trades that are already open, or have perhaps even been opened days earlier.

I was more hoping to hear that something can be done to fix it / improve it if I was perfectly honest.

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I remember that more than one year ago there was the same problem with XAUUSD and Darwinex solved the problem opening one hour later.


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Thanks @CavaliereVerde yes I remember one of those, although they appear to have been price spikes rather than wide spreads? But as you say, maybe the fix would be the same if this continues.

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I want to add an observation made tonight when the market reopened after the WE: GBP USD on darwniex 32 pip of spread… on another broker (without the commission) was 18 pip… (and I trade also with the other broker so I know that the quote is real)… there is really something strange going on in the first hour of the new day.

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Here is a CHF/JPY example from yesterday that stopped me out.

This case was not as extreme as the GBPCAD trade, however, I would still have been in my trade with all other brokers. It makes trading harder, even when trading somewhat bigger time-frame charts.

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I have the same problem with NZDUSD. See this:

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