If you are still learning about how to trade forex, then you might need a little recap about the different kinds of orders that you can use when trading.

Essentially, the most common kinds of orders you will use are market orders, limit orders, or stop orders.

The simples order is the market order. It's fairly self explanatory.  You are either longing or shorting a currency pair at whatever the market price is.

So for example, if you were looking at the EUR/USD, and wanted to take a short.  The current market price is 1.4798 and you click the sell button on your trading platform at that time, then you were filled at the market order of 1.4798.

A limit order allows the trader to determine a specific price in which they want to open and close a position. So, using our previous example of the EUR/USD where it was at 1.4798, and you wanted to short the price. You could use the market order, but you want to be able to get in at a better price. So you'd be looking to put a limit order at a higher price, since you think the price will go higher before it goes lower.

For this example, you might want to put a limit order at 1.4826. This means that your order will not be filled until the price of the EUR/USD goes up to 1.4826. Your order will be opened until you cancel it.

A stop order is most commonly used after your order was filled. It provides protection against losses.  It's really like your squeal point. It's the order you use when you want to say "this is the most I can afford to lose on this trade".

So, again using the previous example, let's say that you were able to get your order filled at 1.4826, and the most we want to lose on this trade is 50 pips, we would put our stop loss at 1.4876 (1.4826 + .0050). This way we protect our account from a huge drawdown.

A stop order can also be used for an entry.  It's most commonly used for breakout methods. Let's say, for example that you are looking at your chart and you believe their is a very pivotal key point at the price 1.4850.  You believe that if the price goes above 1.4850, that the price will just keep going up and up, without any hesitation.  So your main priority would be to get in on the long the moment it breaks 1.4850.  So you'd put a stop buy order at that price, so your order is automatically filled when the price breaks.

If this is still new to you, then I recommend that you start looking at some of the fine forex courses that are available.  Here are some forex education reviews.

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