Entry Limit Orders: Buy Entry Limit and Sell Entry Limit - Limit Order in Forex

Limit order definition - An Entry limit is an order to buy/sell a Forex currency at a certain price which is a pullback area where price is predicted to pull-back to before it resumes the original trend. Traders use them to buy/sell at a better market price. These types of orders are available in most online trade platforms, for our example we shall be using the MT4 platform.

An entry of this type can be used to open buy below the market level (up trend market retracement) or sell above market level (downtrend market retracement).

Buy limit - When buying, your entry buy limit is executed when market falls to your set price. (retraces downward)

Sell limit - When selling, your entry sell limit is executed when market rises to your set price. (retraces up)

Entry orders are set by online traders when they expect price to bounce back after reaching this point.

Entry Buy Limitbuy at a level below the ruling market level.

Entry Sell Limitsell at a level above the ruling market level.

Buy Entry Limit Example

In the example below, the buy limit pending order was set to open buy at a price below the ruling market price. Point B is the point at which it was set.

Entry Limit Order - Pending Orders

Limit buy order entry placed to buy below prevailing market price

The currency then retraced and went down to hit the buy entry limit, and afterwards the price continued to move upward in direction of the original uptrend. When limit buy order was hit it changed into a buy.

Price Hits Buy Limit, Order Now Changes to a Buy - Where and How to Set Limit Orders

Price hits buy limit, order now changes to a buy

Sell Entry Limit Order

In the example below a the sell entry limit was placed to sell at a price above current price. This is the level for the market price pullback.

Entry Limit Sell order Placed on Chart to Sell Above the Current Price - Buy Limit Order & Sell Limit

Entry limit sell order placed to sell above current price

The currency then rallied, went upto hit the sell entry limit, & afterwards the market price continued to move downwards in direction of the original downward trend.

Price Hits Sell Limit, Order Now Changes to a Sell - Entry Limit Order

Price hits sell limit, order now changes to a sell

When forex quote hit the set level the trade order changed to a sell, this is therefore a nice method to buy or sell at a better price after a pull-back.

Setting Buy & Sell Limit Orders on MT4

To set up these orders in MT4 software, RightClick on chart>>> Choose "Trading">>> Then Choose "New">>> Then on the popup window that pops up (portrayed below), under label "Type" choose the option of "pending" instead of "market execution">>> Under pending order options select the pending order type: for This trade select either "Buy Limit" or "Sell Limit" depending on whether you as the trader want to place a pending sell or buy.

Setting Buy & Sell Limit Orders in MT4 - Entry Limit Order - Pending Orders

Setting Buy and Sell Limit Orders in MT4

Sometimes, setting the point value to place your trade can be tricky, setting to far may mean your entry market limit not getting executed, the best tool to use is Fibo retracement technical indicator & use the 38.20% retracement levels. This retracement level is watched by many traders and entry orders tend to crowd at this level, thenceforth the best odds to catch a trade transaction would be presented by using the 38.2% Fib retracement level.

Fibonacci Retracement Lesson - Fib Retracement Tutorial

Tip: In online trading, If you as the trader want to set a good tp order level (not retracement level, takeprofit level) for your trade transactions you can use the Fibonacci extension 100% level for the best tp order area. To Read more on FX Fibo Retracement and Fib expansion use the right navigating menu section Technical Analysis.

Fib Expansion Tool Tutorial - Fib Expansion Tool Tutorial

Study More Lessons and Topics:

Trade Forex Trading

Entry Limit Orders: Buy Entry Limit and Sell Entry Limit - Limit Order in Forex

Buy Entry Limit Example

Sell Entry Limit Order

Setting Buy & Sell Limit Orders on MT4