In the Forex market, there are several types of commands you can make use of in order to control your business. There are commands intended not only to direct your entry but also the exit from market.
Market orders are some of the orders which are implemented directly in the market with the current price. A market order is used to close or open a business in the market.
Limit orders refers to those commands used to exit the lucrative market. If you go long, then limit order will be greater than the market price and if at all short, then limit order will definitely be lower than market prices. You can imagine of a limit order similar to that of a line. If the market price has reached the limit of the order once, then your trade will be packed up and in turn your money will take stock of your account.
Stop orders or else stop loss orders
Stop orders otherwise order of exit is for closing your business. Stop order commonly called as stop loss order, is intended for limiting the quantity of loss suffered in your business. A stop loss order will work when the trade is at a designated level of loss. Also, it will lock in gains when your trade deals with profits.
Entry orders are those orders used to enter market at the fixed price. It is impossible up to a certain level to monitor market each second and this makes money order handy. If you think the market can take some action, such as a price break which it touches, but still has not been able to break, then entry orders would be used to limit entry. When the price goes from your order restricting entry, you too belong to the market.
Entry order is a sword with double edge. The benefit is that one can just enter market when it start moving even when you are away of the same or when you are not paying much attention to it. The main disadvantage of this order is that the market can affect your order entry and take the negative until you posses the chance to valuate any moves. This is the place where a strong risk management comes to play .
Understanding of different orders of forex and their use is essential for the fundamental skills. Take ample time to analyse them and then try to make use of it with a demo account.