A rise in recent months of the number of EAs which trade so-called impulse spikes (such as Forex Thor
) has meant that a lot of questions are now being asked about latency.
Latency is, broadly speaking, a measure of the time taken to send the packets of data from your PC to your broker's server. A poor connection to the broker's server could result in orders failing to execute at the desired price and trading opportunities being missed. What might seem like a very good EA to some users, may easily turn into an absolute nightmare for others!
I say 'broadly speaking' because, to the best of my knowledge, there's absolutely no way of measuring how long it takes to make the one-way connection between the two machines. Instead, we can only measure something that is called round-trip latency.
Round-trip latency is actually a three-part process because it includes not only the two each-way trips from one machine to the other and back again, but it also includes the element of time which is taken by the broker's machine to process the instructions that have been sent and compile a suitable response. For instance, if each trip takes 200 milliseconds, and the broker's server takes 100 milliseconds to execute any instructions and compile its response, then the round-trip latency will be 500 milliseconds; the one-way latency will only be 200 milliseconds and all the important bits and bobs will have been sorted out on your broker's server after 300 milliseconds.
So how can we measure latency to get some sort of an idea whether our connection is any good or not?
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