Which types of Trade Orders do you offer?
Plenty! Pending Orders are orders that are to be executed at a later time at the price a trader specifies. There are 4 types of pending orders: BUY Stops, SELL Stops, BUY Limits and SELL Limits.
BUY Stops
A BUY Stop order is an order placed above the current market price which when triggered, will enter you into a BUY position. The thinking here is that the price will continue to rise once the order is triggered.
Let's take a look at an example:
Say the price of the Wall Street 30 is 34500.0, and you have a hunch that if the price reaches 34520.0, it will continue to rise. You may set a BUY Stop at 34520.0 which will enter you into a BUY position once the price of 34520.0 is hit.
In this example, the BUY Stop order would have triggered on the eighth candle, and then the price would have continued to increase resulting in a trader making a profit.
SELL Stops
A SELL Stop order is an order placed below the current market price which, when triggered, enters you into a SELL position. The idea here is that the price will continue to fall once the order is triggered.
Let's take a look at an example:
Say the price of the Wall Street 30 is 34500.0, and you have a hunch that if the price falls to 34480.0, it will continue to fall. You may set a SELL Stop at 34480.0 which will enter you into a SELL position once the price of 34480.0 is hit.
In this example, the SELL Stop order would have triggered on the second candle, and then the price would have increased afterwards resulting in an initial loss. From the seventh candle, the price would then go below the price of your SELL Stop order and by the close of the 8th candle, you'd begin to make a profit.
BUY Limits
A Buy Limit order is an order placed below the current market price which, when triggered, enters you into a BUY position. The thinking here is that if the price falls to a specific price, the market sentiment will change and the price will then begin to rise once the order is triggered.
Let's take a look at an example:
Say the price of the Wall Street 30 is 34500.0, and you have a hunch that if the price falls to 34480.0, it will then begin to rise. You may set a BUY Limit at 34480.0 which will enter you into a BUY position once the price of 34480.0 is hit.
In the above example, the Buy Limit order would have triggered on the second candle, and then the price would have increased afterwards resulting in a profit. From the seventh candle, the price would then go below the open price and by the close of the 9th candle, the price would have increased past the price of your BUY Limit order, resulting in a profit.
SELL Limits
A SELL Limit order is an order placed above the current market price which when triggered, enters you into a SELL position. The thinking here is that if the price rises to a specific price, the market sentiment will change and the price will then begin to fall once the order is triggered.
Let's take a look at an example:
Say the price of the Wall Street 30 is 34500.0, and you have a hunch that if the price rises to 34520.0, it will then begin to fall. You may set a SELL Limit at 34520.0 which will enter you into a SELL position once the price of 3520.0 is hit.
In the above example, the SELL Limit order would have triggered on the eighth candle, and then the price would have increased afterwards resulting in an initial loss. On the ninth candle, the price would then go below the price of your Sell Limit order, resulting in a profit.