What are Forex Order Types? What is Stop Loss? How does work Take Profit order in Forex Markets? Learn Buy Limit, Sell Limit.

Forex Order Types

You can place various types of orders when trading Forex investments. Some orders control how you enter and exit the market. Understanding what all these orders mean is one of the steps you can take to trade successfully.

Since market prices in Forex can change instantly, you need to be careful when placing orders. As an investor, you need to follow the market well and analyze the market well. You should constantly follow the technical analysis, charts, support and resistance levels of the securities you invest in. If you work well, you can earn significant profits from the orders you place.

Stop Loss

These orders mean that by writing a price level higher than the transaction or market price entered into the open sales position, the position is automatically closed when the price reaches that level. These orders allow trading in an open buy position or automatically closing the position by writing a determined price level below the market price when the price reaches that level. After the stop loss level is determined, in case of a possible loss, it can be compensated up to the maximum stop loss level, which is one of the most important parameters of risk management. When purchasing a position, the stop loss must be placed below the strike price or market price; When selling the position, the stop loss must be placed above the strike price or market price. If this situation reverses, the transaction will be automatically closed as soon as the order is entered, as the price will reach the determined level.

Take Profit

It is an order type that determines the market price at which the open position will reach the desired profit amount. When the market price reaches the determined bet amount, the order will be automatically closed by the system and a profit will be made. . These orders can be placed on an open buy position by writing a price level above the transaction price or the current market price, automatically closing the position when the price reaches a certain level. For open sales positions, a price level is written below the transaction or market price, ensuring that the position is automatically closed with a profit when the price reaches that level.

Buy Limit

It is a buy order that may fall below the current price level. The purpose of a buy limit order is to place an order to buy at a lower level after the price is likely to fall. A buy limit order is used when you want to buy when the price drops below the current market price. Investors place this order; They use them because they think the price will drop to the level they want and the price will rise again after the order is executed.

Sell ​​Limit

It is a sell order that can be placed above the current price level. The purpose of the sell limit order is; It is placing a sell order when there is a possibility that the price will increase. If you want to sell when the price reaches a level higher than the current market price, you can use a sell limit order. Investors place this order; They use them because they believe that the price will rise to the desired level and fall again after the order is executed.

Buy Stop

One of Forex Orders: It is a buy order that can be placed above the current price level. The purpose of the stop loss order is to ensure that the price rises and the upward trend continues after the resistance level is broken. It is used to make purchases at a price above the current price in the market. Although it may seem contradictory to buy above the current price, the purpose of using a buy stop order is that the market price can move even higher if the specified resistance point is exceeded.

Sell ​​Stop

A sell order that could move below the current price level. The purpose of the stop loss order is; After a possible price drop, the price is expected to continue falling and exceed the support level. It is used to carry out sales transactions at prices even below the current price in the market. Although, logically, selling at a lower price than the current market price may seem contrary to the investor’s opinion, as in the buy stop order; The sell stop order is used with the idea that prices may go further down if a determined support point is broken.