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What is a Limit Forex Order?

A Limit Forex Order is an order to buy or sell at a specified price or a better price than the specified price.

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What is a Limit Forex Order?

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  1. What is a Limit Forex Order?

  2. Index 1. What is a Limit Forex Order? 1. Buy Limit Forex Order 2. Sell Limit Forex Order 2. Pro & Con of Limit Order

  3. What is a Limit Forex Order? • A Limit Forex Order is an order to buy or sell at a specified price or a better price than the specified price. • Limit orders have two types of component- buy limit Forex order and sell limit Forex order (Buy Limit and Sell Limit).

  4. Limit orders are of two types 1. Buy Limit Forex Order 2. Sell Limit Forex Order

  5. 1. Buy Limit Forex Order

  6. A Buy Limit is used when the trader looks that the prices of the asset will fall down initially before they start to increase again. • If the prices will fall down before they increase, a market buy order cannot be used because this will cause the immediate negative value to the position.

  7. There is no way of knowing before initiating a trade how negative a position can become before recovery. • Therefore a buy limit is set up by using an entry price which is lower than the market price.

  8. 2. Sell Limit Forex Order

  9. A Sell Limit is used when the trader looks that the price of the asset will first be unfavorable before it falls. • If prices increase before they fall, a market sell order will cause the position to have an immediate negative value. To avoid this, a Sell Limit is used.

  10. Pro & Con of Limit Order • Pro: It will be at your stated price or better • Con: May take some time to fill and sometimes it doesn’t fill at all if the price is moving too quickly.

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