What Are The Order Types Used By Forex Traders?
762
Finance > Currency Trading
Mar 1, 2007
Nathan Young
What Are The Order Types Used By Forex Traders?
During the last decade, Forex trading has become one of the most attractive business opportunities to ever hit people's interest around the world. Every day people from many walks in life is actively considering entering the profitable world of the currency markets due to its accessibility and trading characteristics.
One of the first things you will do once you decide you want to enter and learn about the forex markets will be to choose your forex broker and then download the free trading platform software from your broker website.
When you first open your trading station software, you will find that there are a number of ways to enter the market or, said in another way, there are a number of ways to place an initial order to buy or sell any currency pair.
One of these types of orders is what is called a ?Market order?; this is an order to buy or sell a currency pair at the market price considering the instant that the order is received and processed (which is usually within seconds of hitting the "OK" button on your trading platform). When a market order is placed, you are simply saying "I'll buy or sell the currency pair at whatever price it is at when my order gets processed."
There is a different way to enter the market that is called an ?Entry order?; this is an order to buy or sell a currency pair when it reaches a certain price target; which you should determine by using your knowledge of technical and fundamental indicators. In theory this can be any price. You could set an entry order for the low price of a time period, or the high price of the same time period'; it all depends on your intentions, to sell or to buy. As an example, one usual recommendation is that you should always set an entry order to be the same price as the 'open price? of the time period. When you place an ?entry order? to buy, for example, you are simply saying "I want to buy this currency pair at a given future price and if it never reaches that price, I won't purchase the pair."
Stop and Limit orders are two different ways to exit a trade, automatically (i.e., without closing out your position via the click of your mouse or manually), after the trade is entered. And they are widely used as safety locks so you won't end losing everything in a bad trade. In short, you must always use stops and limits when trading the forex markets.
A ?stop order? is used to stop losses. A ?limit order? (recommended if you can't monitor your open trade) is used to redeem profits. Where these orders are placed, in relation to your open trade, depends on the direction of the entry order, this is; if you buy or sell.
Remember; a ?stop order? is always placed below the current market value of that currency pair when you are in a long (buy) trade. And a ?limit order? is always placed above the current market value of that currency pair when you are in a long (buy) trade. Adrian Pablo is a Forex freelance writer with articles published in a number of places. Get a free report on Fibonacci Trading and learn more about the world of forex trading , visit: www.1-forex.com
One of the first things you will do once you decide you want to enter and learn about the forex markets will be to choose your forex broker and then download the free trading platform software from your broker website.
When you first open your trading station software, you will find that there are a number of ways to enter the market or, said in another way, there are a number of ways to place an initial order to buy or sell any currency pair.
One of these types of orders is what is called a ?Market order?; this is an order to buy or sell a currency pair at the market price considering the instant that the order is received and processed (which is usually within seconds of hitting the "OK" button on your trading platform). When a market order is placed, you are simply saying "I'll buy or sell the currency pair at whatever price it is at when my order gets processed."
There is a different way to enter the market that is called an ?Entry order?; this is an order to buy or sell a currency pair when it reaches a certain price target; which you should determine by using your knowledge of technical and fundamental indicators. In theory this can be any price. You could set an entry order for the low price of a time period, or the high price of the same time period'; it all depends on your intentions, to sell or to buy. As an example, one usual recommendation is that you should always set an entry order to be the same price as the 'open price? of the time period. When you place an ?entry order? to buy, for example, you are simply saying "I want to buy this currency pair at a given future price and if it never reaches that price, I won't purchase the pair."
Stop and Limit orders are two different ways to exit a trade, automatically (i.e., without closing out your position via the click of your mouse or manually), after the trade is entered. And they are widely used as safety locks so you won't end losing everything in a bad trade. In short, you must always use stops and limits when trading the forex markets.
A ?stop order? is used to stop losses. A ?limit order? (recommended if you can't monitor your open trade) is used to redeem profits. Where these orders are placed, in relation to your open trade, depends on the direction of the entry order, this is; if you buy or sell.
Remember; a ?stop order? is always placed below the current market value of that currency pair when you are in a long (buy) trade. And a ?limit order? is always placed above the current market value of that currency pair when you are in a long (buy) trade. Adrian Pablo is a Forex freelance writer with articles published in a number of places. Get a free report on Fibonacci Trading and learn more about the world of forex trading , visit: www.1-forex.com
Write a Review
Add to My Favorite
Refer it to Friend
Report Article
Other links owned by this user
Forex trading has entered the home and lives of many people around the world, both men and women; all of them coming from many lks of life. Being this a relatively new phenomenon in the department of alternative income opportunities. It
Category:
Masters and Johnson have stated that a man ejaculates too quick if he does it before his partner achieves orgasm in more than fifty percent of his sexual encounters. Other sex researchers consider an early ejaculation the one occurring within two minutes
Category:
Until recently I came to realize about the huge amount of men around the world (30% -70 %) that suffer the embarrassing problem of premature ejaculation in their sexual lives; and many without any hope of healing. Before I knew this I thought I was alone
Category:
Nowadays is very common that sexuality determines the direction where love and relationships are heading. By the time a couple join together they immediately want to fulfill desire. When sexuality, loneliness, and other selfish feelings
Category:
During the last decade, Forex trading has become one of the most attractive business opportunities to ever hit people's interest around the world. Every day people from many walks in life is actively considering entering the profitable world of the
Category:
Other links at Finance > Currency Trading
If you're a forex trader, everything is usually about pips. For example, you might say, "I'm up 35 pips for the day," or, "I made 127 pips on my last trade." Although this sounds like a lot of fun, it would probably be helpful to explain what a pip actual
Category:
Companies issue stocks to raise capital for expansion, equipment and other projects. Stocks have been a very popular form of investment for years. Each share of a stock a person owns represents a small ownership of the company. Stock values
Category:
A introduction to currency trading and whether it is a good way to earn money - for the average joe.
Category:
Picture the scene -- you have done your an alysis and have been waiting for the breakout of a range. You might even have identified a head and shoulders or double bottom. So anyway, you have a trade all set up and you are just waiting for the move.
Category:
Forex analysis is divided into two types: fundamental and technical. A fundamental analysis uses economic and political factors as a means of predicting currency movements. A technical analysis uses reliable historical data as a means of forecasting these
Category:
Site Sponsor
Directory Statistics
Articles: 68252
Categories: 501
Yahoo Entertainment
