It is evident that there are a number of forex order types available, and it is important to know all the orders before doing trading. It is also true that traders choose their own brokers, and there are some occasions when they don’t offer all order types. In this article will be able to go through different types of forex orders types like:
- One cancels the other orders
- Limit orders
- Market orders
- Stop loss
One cancels other orders
- This fx order type is like how it sounds. One cancels other orders is actually a mixture of two entry or stop loss orders.
- This means that you can use both limit order and stop loss together.
- One most of the important facts about this forex order type is that with it, is not required to observe a trade long in the market.
- It is very simple to understand, and it is actually a request to buy or sell at a scheduled price.
- It also has an added advantage, and it is that there is no a kind of charge for limit order but in the market order, it is there.
- In addition, order as the price reaches the level specified, the trade will be performed.
- For example, might want to purchase when the price touches a certain level and will sell if the price fell as compared to the level where it was actually.
- A market order is nothing but it is a forex order type which is required to do trade at the given current price.
- Let’s take an example. The bid price for US dollar/Euro is at 1.2150, and the ask price is around at 1.2143. So if you wants to purchase US dollar/Euro at market then it would be sold to the trader at the ask price of 1.2143. Then would surely like to buy, and broker will perform a buy order at the exact price.
- A market order can also be understood easily that can open a trade through a market order.
Stop loss orders
- Stop loss forex order type is the most effective order which is usually used to defend against losses in existing trades.
- It can be explained easily with an example. Suppose you have bought currency along with the expectation that it will surely rise but suddenly you see that its value start falling. In that case, you can definitely use stop loss orders in order to limit the loss from the trade going in the reverse direction which you have planned.
- For an instance, suppose might enter a trade with currency pair of 1.2143. The trade is buying a standard lot in which each percentage in point, will worth around $10. So if you wishes to limit his/her loss to 10 percentage in point, or $100, in that case, the stop-loss order will be set at 1.2133.