Question About Stop Loss Behavior in RSI Strategy cBot

QTel49

I am currently using your RSI Strategy cBot in cTrader and have a question regarding the behavior of the Stop Loss. In my settings, I have configured the Stop Loss to 0.1 pips, and I have disabled the Trailing Stop.
However, during backtesting and live trading, I am noticing that some losses are significantly larger than 0.1 pips. I would like to clarify the following:

Is the Stop Loss implemented as a hard SL on the order, or is it a virtual SL managed by the cBot logic?
What is the recommended minimum Stop Loss for this strategy to work effectively?
Are there any broker or cTrader platform limitations that could override or ignore a 0.1 pip SL?
I look forward to your feedback. Thank you in advance for your assistance.

algoman

Hi, if you are referring to the cTrader Relative Strength Index Strategy.

Thank you for your enquiry and for using our RSI Strategy cBot.

Regarding your observations about the Stop Loss (SL) behaviour, I'd like to provide clarification on each of your questions.

1. Stop Loss Implementation
The cBot applies the Stop Loss as a hard SL on the order, meaning it is sent to the broker along with the trade and not managed virtually by the bot logic. However, even though the SL is defined as 0.1 pips, execution may differ slightly due to market conditions, particularly the spread.

2. Why Losses Appear Larger Than 0.1 Pips
The main reason you're seeing losses larger than the configured 0.1 pips is due to the spread. When a trade is closed by Stop Loss, it closes at the bid or ask price, depending on whether it's a buy or sell order. If the spread at the time of exit is greater than 0.1 pips, the effective loss will exceed your configured SL.

For example:

On a buy order: SL is triggered at a bid price, but the entry was at ask price.

If the spread is 0.2 pips, your loss will be approximately 0.2 pips, regardless of your SL setting.

3. Recommended Minimum Stop Loss
We recommend setting a Stop Loss of at least 2–5 pips, depending on the instrument and typical spread conditions. Extremely tight spreads, such as 0.1 pips, often do not function effectively in live markets, where spreads can vary moment-to-moment, especially during periods of low liquidity or volatility.

4. Platform or Broker Limitations
Yes, both cTrader and brokers may have minimum distance requirements between the entry price and SL/TP. This means that SL values below the minimum threshold (often 1 pip or higher) may be rounded up or rejected. Additionally, due to latency and slippage, execution can deviate from expected values, particularly for tight service-level agreements (SLAs).

In Summary:

The SL is hard-coded to the order but subject to real-world execution conditions.

A 0.1 pip SL is generally impractical in live trading due to spread, slippage, and broker constraints.

Consider increasing the SL to improve strategy reliability.

Please let us know if you'd like help optimizing the SL for your trading instrument, or if you have further questions.

QTel49

I’m using the RSI Strategy cBot on XAUUSD with the Stop Loss set to 5 pips and lot size at 0.01. I’ve noticed that the largest losing trade in my backtest was –$54.74, which should not be possible with such a tight SL.
After reviewing the trade history, I see that this trade was not closed by the Stop Loss, but rather by a logic signal from the bot (likely an RSI rule).
Could you confirm:
1. Does the cBot sometimes exit trades via strategy signals instead of honoring the SL?
2. Is there a way to force the bot to always exit via SL or TP only?
3. Can I disable logic-based exits and rely strictly on SL/TP?
Thank you for your assistance in clarifying this. I’d like to ensure that Stop Loss protection is always applied to prevent these large losses.

Sebastian

According to the product page, there are three criteria to close a trade using the cBot.

Hard stop loss.
Trailing stop loss
Reverse RSI signal.

Without seeing your cBot settings, it's challenging to help you. I suggest that you provide the following:

Your cBot settings.
A Chart shot showing the trade that closed with the trade history below.
Your broker.

How to share a chart shot

You should also be aware that with Forex, the spreads can be as low as 0.1 pips and up, but with a symbol like XAUUSD, the live spread can be five pips and above, use something like 15-50

With IC markets the trade size starts at 1 oz and not 0.01 lots