An Forex order is an instruction from trader to broker that shows how the trader wants to enter or exit the market. Here are some of the most common tabs of orders.
Market Order
A market order is in order to buy or sell immediately at the best available price.
This type of order guarantees that the order will be executed. Just remember that in a fast moving market, price paid or received may be quite different from the last price quoted before the order was entered.
Limit order
A limit order is in order to buy or sell at a specific price. A buy limit is in order to buy at the limited price. This price will always be below current market price. Let’s take a look at this example. The trader wants to buy euros to us dollars, but he’s only ready to buy if he can do it more cheaply. A sell limit is in order to sell at the limit price.
This price will always be above the current market price the trader wants to sell, but only if he can sell at a price higher than the market price.
Stop Loss Order
A stop loss order is in order to buy or sell once the price reaches a specified price, it’s designed to prevent additional losses If the pricing goes against you, it is the most important order of all.
Consider that you have purchased Euros to us dollars at 1.3000. And you realize you made a wrong move, which is a common case when the prices start to fall, you place a stop loss order at 1.2980. And when the price touches this value, your broker will close the position automatically, which contains your loss to 20 pips. If you had not set your stop loss, the price could have continued falling until you lost all the money. You wouldn’t want that, right? So always use your stop loss orders.
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