Slippage is the difference between the expected fill price of an order and the actual fill price. It occurs when the market moves between the time you submit an order and the time it is executed. Slippage can be positive (better price) or negative (worse price) and is most common during high volatility, news events, or in low-liquidity markets.
You place a market order to buy EUR/USD at 1.1050. Due to a sudden spike in volatility, your order is filled at 1.1053 — that is 3 pips of negative slippage. If it had filled at 1.1048 instead, that would be 2 pips of positive slippage.
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