A perfect setup executed badly is a losing trade. On thin names the execution IS a skill: this lesson covers the order type that should be your default, how to enter without becoming the slippage statistic from Lesson 0.1, and the single line that separates entering from chasing.
The default order: the marketable limit
Market orders eat the book blind. Plain limits at the bid may never fill on a mover. The professional default splits the difference:
Ask $4.20 → limit $4.24.
Fills immediately like a market order, but $4.24 is a hard ceiling:
you can pay UP TO $0.04 of slippage and not a cent more.
If the tape jumps past $4.24, you simply do not fill. That is protection, not failure.
This one habit caps the invisible tax that ruins thin-name trading. Our own systems trade exclusively with marketable limits for the same reason. Bonus: unlike market orders, limits are accepted on halted stocks, so a marketable limit is also how you queue sanely for a reopen (Lesson 1.5).
Scaling in: confirmation buys the rest
Nothing requires the full position in one click. The taught convention on momentum entries (Cameron's version uses the tape; ours uses structure) is the starter-and-add:
- Starter (a third to a half of intended size) at the trigger: the ORB break, the reclaim hold, the fresh HOD print.
- Add on confirmation: the break HOLDS (no immediate re-entry into the range), volume expands, the first higher low forms. The add goes at a defined structure, not "it went up so I bought more."
- Total risk unchanged: compute size (Lesson 3.1) for the FULL intended position from the start; the scaling only changes when the shares arrive, never how many.
The payoff: on the false breaks (the 75% of Lesson 2.1) you lose a fraction of 1R, and on the real ones you are fully aboard by the first higher low. The asymmetry engine, applied to the entry itself.
The chase line
Slippage budgeting
Even done right, thin-name entries cost something. Budget it consciously: assume the spread plus one tick each way as your standing toll (on a $0.04-spread name, call it ~$0.06 per round trip per share). Two consequences: very tight stops on thin names are partly fictional (the toll eats them: prefer structure stops with room, sized correctly), and very frequent trading multiplies the toll into a strategy-killer: our July research measured exactly this killing an otherwise-positive intraday system. Fewer, better entries is not a slogan: it is the slippage math.
- Marketable limit is the default: instant fill, hard slippage ceiling, works through halts.
- Scale in: starter at trigger, add on held confirmation, total risk pre-computed and fixed.
- Set the chase line before the open (1-2% past trigger). Past it, the trade does not exist.
- Budget the toll: spread + a tick each way, every round trip. Frequency multiplies it.
- Missing a move costs nothing. Chasing one costs the spread, the size, and the stop, at once.
Drill: fill-quality week
For one week, log every entry: intended price at trigger, actual average fill, difference in cents and in % of your stop distance. Traders are routinely shocked to find slippage consuming 10-20% of their theoretical edge. Once measured, the marketable-limit habit and the chase line stop being rules you follow and become money you keep.