forex trading platforms offer the flexibility
to enter a variety of order types that include:
A market order is an order to buy or sell a
specific currency, which is to be filled immediately
at the current exchange rate quoted on the screen.
Each of the online forex trading platforms offer
real-time streaming forex prices with fast,
easy and efficient one-touch order execution.
The market order allows the client to follow
the real-time bids and offers on the screen
that can be executed with a click of the mouse.
The most advantageous aspect of the market order
is the ability for the trader to capture better
An order to buy or sell a currency pair, which is executed
when the price is breached. For example, you place an order
to buy 100,000 euro at 1.0950. The platform will automatically
fill your order when the offer reaches 1.0950. Limit orders
can be placed to both buy and sell.
A stop order is a type of limit order that is placed to "lock
in" a specified gain or loss, closing the position. Typically
a risk management order used by clients to help manage their
market exposure, this type of order can also be used to enter
into a new position. Stop orders can be used to both buy and
sell foreign currency contracts.
traditional "stop-loss" order is used by forex traders
to prevent losses in excess of pre-determined acceptable risk
levels. Virtually all professional forex traders determine
both their accepted targets and risk levels prior to entering
each and every trade. For example, if you bought GBP/USD at
1.7480 you could enter a stop-loss order to sell at, say,
1.7460. This would effectively limit your potential loss on
the position to 20 pips if the price fell.
"trailing stop" is used to lock in desired targets.
For example, if you bought GBP/USD at 1.7480 and the price
has risen to 1.7520, giving you 40 pips, you may want to lock
in a certain amount in case the price falls back down. You
would simply place a stop order to sell at, say, 1.7510. This
assures that if the price does drop, your position will be
closed automatically at 1.7510. If the price keeps increasing,
the trader can may move his or her trailing stop.
stop order can also be used to enter into a new position.
For example, if the EUR/USD is currently trading at 1.3200
and you believe if the market breaches an expected support-level
of 1.3185 that the EUR/USD will continue to fall in price
until it reaches a lower support level around, say 1.3150,
then you could place a "sell-stop" order at 1.3180.
The sell-stop order will trigger an automatic order to sell
at the market once the EUR/USD is 1.3180 bid, allowing the
anticipated downward price movement. Conversely, if the EUR/USD
is currently trading at 1.3200 and you believe if the market
breaches an expected resistance-level of 1.3225 that the EUR/USD
will continue to rise in price until it reaches a higher resistance
level around, say 1.3260, then you could place a "buy-stop"
order at 1.3230. The buy-stop order will trigger an automatic
order to buy at the market once the EUR/USD is 1.3230 offered,
allowing anticipated upward price movement.
is important to note that, by convention, "buy limit"
and "sell stop" orders are entered in below the
current market price. "Sell limit" and "buy
stop" orders are entered in above the current market