Brokers set a stop level — the minimum distance between the current price and a stop or limit order. Some set it to zero, others to several points. For scalpers with tight stops, it matters.
With a non-zero stop level:
Stops and targets cannot be placed closer than the minimum distance.
Very tight stops (e.g. 2 pips) may be rejected on entry.
Trailing a stop close to price during a trade may not be possible.
With stop level zero:
Stops can be placed anywhere, but the freeze level may still block modifications when price is very close.
Very tight stops are more likely to be triggered by normal spread fluctuation.
Both values are listed in the symbol specification in MT4/MT5 (right-click the symbol in Market Watch → Specification). They can differ between symbols and change during news.
What stop level does your broker set, and has it ever affected your trades?
Stop level zero sounds like freedom, but on a long the stop triggers on the bid. With a 0.8 pip spread at entry, a 2 pip stop is really 1.2 pips from where the bid sits, and a widening to 1.5 pips at rollover can take it out.
The error code is the quick way to tell which limit you hit. MT4 throws 130 for invalid stops and MT5 returns 10016, and if those appear only around releases, the broker is raising the stop level dynamically rather than living by the listed number.
On my current account EURUSD shows zero for both stops level and freeze level, while gold shows a stops level of 20 points. I only noticed when an EA trailing routine kept failing silently on gold.
Some people solve it with virtual stops held inside the EA. I use them only as a second layer, because if the VPS drops, the position is naked, and I have had a terminal freeze for four minutes during a data release.
Has anyone seen a broker publish how far the stop level gets raised during news? My guess is most retail traders find out the hard way.
