Using different types of orders helps to improve your trading

Choosing the right type of trading order is a significant ingredient in the process of decision making. There are four types of orders below.

1. Market orders are orders that traders place at the instant price of the market. The electronic trading system boosts the speed of trading but increases the volatility of the price movement. The price of the order may differ from the one of the last second. People are not likely to secure the price by a market order. Traders who execute the market order increase the position opened in the market instead of the exact price of the currencies. So we can open a position with a long-term trend.

2. Limit orders are designed to make sure that traders enter the position with an acceptable and payable price. The buy limit order is placed at the current market price and offers the highest price that traders want, while the sell limit order is in the opposite situation. The limit order allows traders to have a proper cost of trading while the position is not guaranteed. If traders have strict requirements on cost, the limit order is a choice.

3. Stop orders are used to minimize the loss of an existing position and protect the profits of traders. The order will be placed automatically at a price as programmed before. We can set the orders before bedtime. But this means that the trader gives up the potential returns. It is not perfect but effective to deal with the position we are not available to deal with.

4. Market-if-touched is a combination of limit order and market order. An MIT order will be placed at the instant market price. When the limit price line is hit, the position is opened at market price.

These four orders should be applied in your trading plans. Familiarizing suitable methods in the Forex market is helpful.