Buy limit fx simply means getting in on a limit order in trading. For a better understanding, you need to know what trading is, what a fx order is, and what a limit order is.
DEFINITION OF FOREX TRADING
Fx simply means foreign exchange; the “FOR” stands for “foreign”, while the “EX” stands for exchange. As you may already know, the main item for exchange in fx is currency. So trading can be defined as the foreign exchange of currencies.
DEFINITION OF FOREX ORDER
A fx order is how a trader can actually trade in the market. A trader cannot directly make things happen in the market; the trader needs the help of a broker to be able to really trade in the market. The responsibility of the broker amidst other things is to effectuate the orders given by the client, which is the trade. So a fx order can be defined as an instruction from a trader to his or her broker on how and when to trade the currencies attributed to the fx trader.
DEFINITION OF A LIMIT ORDER
A limit order is one such fx orders that a trader can place regarding currency trades. By definition, a fx limit order is an order placed by a trader asking his or her broker to sell a security (in this case, currency) at a specified price. The price at which the security is sold can be different from the specified price if it favors the client, but anything short of profit to the client is not acceptable within a fx limit order. The order is time sensitive; this means that the order can only work within the time stated by the trader.
TO BUY A LIMIT ORDER IN FOREX OR SIMPLY “BUY LIMIT ORDER”, WHAT IS THE BENEFIT?
To buy a limit order in fx, or simply “buy limit order” in fx is all about placing a fx limit order expecting the brokers responsible for performing the order appropriately. What is the major reason why a trader would want to place a buy limit fx order? The thing about buy limit fx order is that it ensures that negative slippage does not occur. Slippage is the difference between the expected price of the trade and the price at which the trade is actually performed.
STOP LIMIT ORDER FOREX
A stop limit order is just like a limit order, but with a little difference. It is a combination of a buy limit order and a stop order. A stop order is an order to buy or sell a security when the price surpasses a specific point, making the entry or exit price predetermined. (See above for the definition of a limit order in fx). Combining the definitions of stop order with that of a limit order, one can easily say that a stop-limit order is an order that grants sales of securities at a given price or after a stop order has been reached, hopefully for a better result.