The three main types use in forex are stops, limits and market orders. Depending on whether you want to be a buyer or seller, above or below or at the market price will determine which of the below orders you should be using.
Stop buy buy order above the current market price
Limit sell sell order above the current market price
Market order buy or sell order at the current market price
Limit buy buy order below the current market price
Stop sell sell order below the current market price
Stop orders are commonly used for breakout and momentum style strategies. They buy in a rise market and sell and a falling market. Traders will often place these orders above resistance or below support, trading a break of these levels.
Limit orders are used by range and counter trend traders. Limit orders sell into a rising market and buy into a falling market. Because of this they are preferred by more experienced traders who are able to place these order types at key resistance and support levels, picking market swing points.
Market orders are orders to buy at the current ask (offer) rate or sell at the current bid rate.
Stop loss orders are orders to close a position at a predefined level set by the trader. This would normally be at a loss. These are technically stop buy and stop sell orders.
Take profit orders are orders to close a position at a predefined level, normally at a profit. These orders are limit orders.
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