Forex Basic - Types of Orders

Instant / Spot Order

BUY

Buy / Long means taking a position buy a currency pair, and will earn a profit when the currency front increases and / or the currency is behind the decline.

Example: Buy EURUSD, it will profit if the Euro rises and / or the USD falls. Conversely, if the euro falls and / or USD rises, it will suffer losses.

SELL

Sell / Short Sell means taking a position of a currency pair, and will earn a profit when the currency front decreased and / or the currency is behind the increase.

Example: Sell EURUSD, it will profit if the Euro fell and / or the USD rises. Conversely, if the euro rises and / or the USD falls, it will suffer losses.

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Take Profit & Stop Loss

TAKE PROFIT

To buy a position, the position will be covered if the bid price rise shown on the Take Profit.

To sell the position, the position will be closed down if the Ask price reaches listed in Take Profit.

Applications: A now buy EURUSD at 1.2345, if the EURUSD rose to 1.2400, then A will buy its close position. Then A set take profit at 1.2400.

STOP LOSS

To buy a position, the position will be closed if the bid price reaches a specified fall in Stop Loss.

To sell the position, the position will be closed if Ask increased to reach a price stated in the Stop Loss.

Applications: A now buy EURUSD at 1.2345, if the EURUSD fell to 1.2300, then A will close its buy position (to limit losses). Then A set of stop loss at 1.2300.

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Pending Order

BUY STOP:

Orders will be buy when Ask the same as stated in the transaction prices Buy Stop. Buy Stop could be opened if the price is now lower than the price listed on the Buy Stop transaction.

In essence, if the price rises until the X, I buy, use buy Stop

SELL STOP:

Order will be a sell if the bid equal to the price indicated on the Sell Stop transaction. Sell Stop could be opened if the price is now higher than the price listed on the Stop Sell transaction.

In essence, if the price drops to X, I sell, then use the Stop Sell

BUY LIMIT:

Order will be buy when Ask the same as indicated on the transaction price Buy Limit. Buy Limit may be opened if the price is now higher than the price listed on the transaction buy Limit.

In essence, if the price drops to X, I buy, then use Limit Buy

SELL LIMIT:

Order will be a sell if the bid equal to the price indicated on the Sell transaction limit. Sell Limit could be opened if the price is now lower than the price listed on the Sell transaction limit.

In essence, if the price rises until X, I sell, then use Limit Sell