By Saskia, Forex Trader & Coach at FXC Academy | Last updated: June, 2026

• Slippage occurs when an order executes at a different price than expected
• It can be positive or negative
• Volatility and liquidity are common causes
• Slippage is a normal part of market execution
• Understanding slippage helps traders manage expectations

Slippage occurs when a trade is executed at a different price than the one requested when placing an order.

A common question traders ask is:

What is slippage in trading?

Slippage is a normal market occurrence that can happen in Forex, stocks, commodities, and other financial markets, particularly during periods of increased volatility or lower liquidity.

Understanding slippage helps traders better understand how trade execution works in real market conditions.

Financial markets move continuously.

Between the moment an order is submitted and the moment it is executed, the market price may change.

If the available market price differs from the requested price, slippage can occur.

This is especially common during:

• major news releases
• central bank announcements
• high volatility events
• periods of reduced liquidity

Slippage is not always unfavourable.

Occurs when an order is filled at a better price than requested.

Example:

• Buy order requested at 1.1000
• Executed at 1.0998

The trader receives a more favourable price.

Occurs when an order is filled at a less favourable price.

Example:

• Buy order requested at 1.1000
• Executed at 1.1003

The trader receives a higher entry price than expected.

Both forms of slippage are possible in fast-moving markets.

Imagine a trader places a market order to buy EUR/USD at:

• 1.1000

During a major economic announcement, the market moves quickly.

The order is executed at:

• 1.1004

The difference of four pips represents slippage.

This example demonstrates how market conditions can affect execution prices.

Market orders prioritise execution over price.

This means:

• the order will generally execute at the next available market price
• the final execution price may differ from the requested price

This is one reason why slippage can occur.

Slippage cannot always be eliminated because it is a natural consequence of market movement.

However, traders often seek to understand factors that may influence slippage, such as:

• market volatility
• liquidity conditions
• major economic announcements

Understanding these conditions can help traders better interpret execution outcomes.

Financial authorities such as the Financial Conduct Authority (FCA) highlight that market prices can move rapidly and that execution prices may vary during volatile periods.

Slippage is often studied alongside:

• spreads
• liquidity
• market sessions
• volatility

These factors collectively influence overall trading conditions.

For example:

• wider spreads and increased slippage may occur during major news events
• active market sessions may provide greater liquidity

You can learn more in our What Is Spread in Forex Trading?  article.

FXC Academy is a Forex education platform that provides guides, courses, and learning resources designed to help traders understand currency markets, trading strategies, and risk management.

Our educational content supports traders at different stages of their journey, from beginners learning the fundamentals to more experienced traders refining their trading knowledge.

Risk Warning
Forex trading involves significant risk and may not be suitable for all investors. You could lose all of your invested capital. This content is for educational purposes only and does not constitute financial advice.