Learn Every Type of Forex Order and How Trades Are Executed in the Real Market
Understanding order types is one of the most important steps in becoming a confident Forex trader. Whether you trade manually or rely on an automated system like The Easy Pip, knowing how orders work helps you:
This chapter gives you a complete, easy-to-understand explanation of market orders, pending orders, stop loss, take profit, and execution mechanics.
A market order is an instruction to open a trade immediately at the best available price.
When you click Buy or Sell:
Market orders are ideal when:
However, because the market moves quickly, your order may experience slippage—meaning it fills at a slightly different price.
Used when you expect the base currency to rise.
Example:
Buying EUR/USD because you expect the Euro to strengthen.
Used when you expect the base currency to fall.
Example:
Selling GBP/USD because you expect the Pound to weaken.
A pending order lets you set a trade that activates later when price reaches a specific level.
Pending orders are essential for:
Here are the 4 main types.
You place a Buy Limit when you expect price to fall first, then rise.
Example:
Price is 1.2050.
You place a Buy Limit at 1.2000.
Meaning → you want to buy at a lower price.
Used for:
You place a Sell Limit when you expect price to rise first, then fall.
Example:
Price is 1.2050.
You place a Sell Limit at 1.2100.
Meaning → you want to sell at a higher price.
Used for:
You place a Buy Stop when you expect price to break above a certain level and continue upward.
Example:
Price is 1.2050.
You place a Buy Stop at 1.2100.
Meaning → you want to buy when momentum starts.
Used for:
You place a Sell Stop when you expect price to break below a level and continue falling.
Example:
Price is 1.2050.
You place a Sell Stop at 1.2000.
Meaning → you want to sell when downward momentum starts.
Used for:
Some brokers offer hybrid orders like Buy Stop-Limit or Sell Stop-Limit, where a stop triggers a limit order.
These are used for precision entries in fast markets but are more advanced and not offered by all brokers.
A Stop Loss is a safety tool that automatically closes your trade to prevent larger losses.
Example:
You buy EUR/USD at 1.2000.
You set SL at 1.1980.
If the market hits 1.1980 → your trade closes automatically with a small loss.
Why SL is essential:
Never trade without a Stop Loss.
A Take Profit automatically closes your trade when price reaches your desired profit level.
Example:
You buy EUR/USD at 1.2000.
You set TP at 1.2050.
If price reaches 1.2050 → trade closes in profit.
Benefits:
Understanding how profit is calculated helps traders evaluate risk before entering a trade.
Example:
You BUY EUR/USD at 1.2000.
You close at 1.2050.
Difference → 50 pips
If you traded:
Profit/loss depends on:
Profit shown while trade is open.
Profit after trade closes.
This is the amount added or deducted from your balance.
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Forex and algorithmic trading involve a high level of financial risk and may not be suitable for all investors.You may lose some or all of your invested capital; only trade with money you can afford to lose.The Easy Pip is not responsible for any profits or losses incurred while using the software.Past performance does not guarantee future results; markets can move unpredictably.
