HiwayFX- Got my over $1,000 live trading account into a negative balance.

[Pharaoh]

Open a demo account. Turn on the ask line and go to a 1 minute or 5 minute chart. Open and close some orders (buy and sell), one at a time, and watch closely.

 

[fadem]

Thanks for your response, but what am I to look out for?

 

[Pharaoh]

If you to this during calm market times, you'll be able to see which price (bid or ask) the orders execute at.

 

[fadem]

Am sorry I still don't understand how that affects an already opened position.
Is spread not an initial one off fee?

 

[Pharaoh]

In the simplest terms, you open at the worst of the 2 prices and close at the worst of the 2 prices.

So, if price did not move, the price was 1.00000/1.00020 (2 pip spread) and you opened a position and then closed it, you would be down 2 pips (20 points on a 5 digit broker).

Using the numbers above, if you buy, the position opens at the least advantageous price (1.00020) and closes at the least advantageous price (1.00000). If you sell, the position opens at the least advantageous price (1.00000) and closes at the least advantageous price (1.00020).

So, you only pay the spread once, but if you don't turn on that ask line, you may not realize exactly when and where that spread is hitting you.