Forex Basics: Entry Orders

There are different types of orders that can be used in Forex trading. The most common are:
- Market Orders
- Entry Orders (stop or limit)

A market order is simple a request is sent to the Forex broker to buy or sell a currency pair immediately at the best available current price. As Forex is a highly liquid market, market orders can be expected to go through immediately.

Placing market orders during a news release is not recommended as the price can move quickly and your brokers response to fill your order can be delayed (sometimes up to 20 minutes!), this can result in getting your order filled at a significantly different price than you expected.

An Entry Order is placed as either a Stop or Limit Order.
BUY = Place a stop order if you want to buy at a price higher than the current price. Place a limit order if you want to buy at a price lower than the current price.
SELL = Place a limit order if you want to sell at a price higher than the current price. Place a stop order if you want to sell at a price lower than the current price.

Your entry order will become a market order when the price hits your stop/limit order price.

Most Forex brokers also give you the choice of when you want your order to be canceled if your stop/limit price is not reached.
- End Of Day (EOD) = Your order will be canceled at the end of the day.
- Good Until canceled = Your order will be active until you cancel it or it is triggered by reaching your stop/limit price.