Floating Spreads in a Tight-Spread Mode (ECN Model)
At Bybit, spreads in the tight-spread mode are set up based on an ECN model. We do not add extra spread between the bid and ask prices, allowing traders to benefit from raw market conditions. However, spreads are floating, meaning they vary based on market factors such as:
- Volatility: Higher volatility often leads to wider spreads.
- Liquidity: Lower liquidity can increase the spread.
- Supply and Demand: Changes in these dynamics can also impact spreads.
Stable Spreads in a Zero-Fee Mode (STP Model)
The Zero-Fee mode is designed to deliver stable spreads with zero additional commission. Traders will benefit from all-inclusive pricing, which enables smooth and more cost-effective trading experience.
Understanding Bid and Ask Prices on TradFi
When viewing historical candlesticks on MT5, remember that these charts display bid prices only. As a result:
- A buy order or closing a sell position is executed at the asking price, which may not match the chart’s displayed prices.
- Traders may notice discrepancies between their executed orders and the prices seen on the chart. This is because the ask price is not recorded in the historical data.
How to Display Ask Prices on MT5 Charts on MT5 Client Terminal
You can enable the ask price line on your MT5 chart to understand price dynamics in real time better. Here’s how:
- Right-click on the chart and select Properties or press F8.
- Go to the Common tab.
- Check the box for Show Ask Line.
- Click OK to apply the changes.
The ask price line will now display alongside the bid price on the chart. Please note that this line only appears in real-time and is not saved in the historical data.
Key Takeaways
- Market conditions influence spreads on our platform and may widen during volatility.
- Historical candlesticks in MT5 show bid prices only, which can confuse traders referencing the chart.
- Enabling the ask price line can provide better visibility into real-time price movements.
By understanding these dynamics, traders can make more informed decisions and manage their strategies effectively.