Instant Orders Vs Pending Orders

Instant Orders Vs Pending Orders With so many Instant Orders Vs Pending Orders its crucial to make sure that trading the financial markets is as easy as 1 2 3. Be sure to take note, that opening a pending trade order with a set price for buy or sell can skip a trade entirely, if those exact conditions aren’t met. Here are a few definitions that you should know when dealing with pending orders:

Good til cancel. A GTC order is any standing order that has conditionals, for instance a specific ask price. The GTC order will remain pending until that condition is met — and that condition may never be met. A GTC order’s benefits is that it’s highly specific: you’ll buy or sell the currency pair exactly when your conditions are right. It can be dangerous however because it will remain outstanding; a trader needs to do account management and be aware of their GTC trades so that they don’t risk accidentally overextending themselves.

Stop orders. A stop order is a buy or sell trade that will initiate once the currency pair has reached its stop price. Stop orders are generally placed a certain amount away from the current market price so that the trader can pick up their trade at a specific point. Stop orders are a type of GTC trade as they will exist in pending until the stop price has been reached.

Limit orders. A limit order is a buy or sell trade that initiates once the currency pair has reached its limit price; it is essentially the opposite of stop orders. Limit orders will operate as GTC trades until the limit price has been reached. Some traders have strategies for positioning limit prices and stop orders so that they can capture slightly more profit each trade.

Take profit. A take profit is when the trade should actually capture profit. It is the price that the currency pair will need to reach for the trade to close. Setting a take profit is essential to many strategies; it ensures that the trader will not miss an opportunity (as the market does move quite fast) and it will make sure that they stick to their strategy. Without a set take profit, a trader may instead be tempted to let a trade ride in order to capture even more profit; this could result in the trade losing money instead.

Stop loss. A stop loss is the counterpart to a take profit. A stop loss stops the trade once the market price has fallen to a certain amount. Stop losses are occasionally used instead of take profits in strategies. The benefits of the stop loss is the same as the take profit: it reduces the risk to the trader by ensuring that the trade is closed when it needs to. Many trades will use both a take profit and a stop loss to make sure that the trade does not linger too long in any single direction. Stop losses are generally placed fewer pips away from the current market price than the take profit, for obvious reasons.