Stop Loss Stocks Order vs Limit Definition

Stop Loss Stocks Order Meaning

Stop Loss Stocks Order is a type of order placed after opening a stocks trade that's meant to cut losses if the stocks market moves against you in opposite direction.

Stop Loss Stocks Order is a pre-determined point of exiting a losing stocks trade & it is meant to control losses in stocks.

A stop-loss order is an order placed with your stock broker which will automatically close your open stocks trade when the price of your open trade order reaches a pre-determined stocks price. When the set level is reached, your open stocks trade transaction is liquidated.

These stop loss orders are designed to limit the amount of money that trader can lose: by exiting the stocks trade if a specific stocks price that's against the trade is reached.

For example, a trader might open a buy stocks trade & put a stop loss of 20 pips, if the stocks price moves against the trader by 20 pips the stop-loss order will be filled and the trade will be liquidated thereby limiting loss to 20 points (pips) - Stop Loss Stocks Order Definition.

Limit Stocks Orders: Buy Limit Stocks Order vs Sell Limit Stocks Order

Limit order definition - Stocks Trading limit is an order to buy or sell at a certain stocks price which is a retracement level where stocks price is predicted to pull-back to before resuming the original Stocks trend. Stocks traders use stocks trading limit orders to buy or sell at better market price. Buy Limit Stock Order and Sell Limit Stock Order - types of limit stocks orders are available in most online trading platforms, such as the MT4 platform.

Buy Limit Stock Order and Sell Limit Stock Order - A stocks trading order of this type can be used to buy below the stocks market level (upward trend stocks trading retracement) or sell above the stocks market level (downwards trend stocks trading retracement).

Buy limit Order - When buying, your stocks buy limit is executed when the stocks market falls to your set stocks price. (retraces down) - buy limit order set below market stocks price

Sell limit Order - When selling, your stocks sell limit is executed when the stocks market rises to your set stocks price. (retraces up) - sell limit order set above market stocks price

Limit orders are placed by traders when they expect stocks price to bounce back after reaching this set level.

• Buy Limit Stocks Order buy at a level below the current stocks market level.

• Sell Limit Stock Order sell at a level above the current stocks market level.

Buy Limit Stocks Order Example

In the buy limit order example illustrated and explained below, the buy stocks trading limit order was placed to buy at a stocks price below the current stocks price. Point Marked B is the point at which it was set.

Buy Stocks Trading Limit Order Example - How to Use Stocks Trading Limit Buy Orders - Limit Stocks Order Buy Examples

The stocks price then retraced and went down to hit the buy stocks trading limit order, & afterwards the stocks price continued to move upwards in direction of the original Stocks upwards trend. When the stocks limit buy order was hit it changed to a buy stock trading order - How to Use Stocks Trading Limit Buy Orders.

Stocks Price Hits Buy Limit Stocks Order, Limit Buy Order Now Changes to a Buy Order - How to Use Buy Limit Stocks Orders

Sell Limit Stock Order Example

In the sell limit order example illustrated and explained below a the sell stocks trading limit order was placed to sell at a stocks price above the current stocks price. This is the level for the stocks price retracement.

Sell Limit Stocks Trading Order Example - How to Use Stocks Trading Limit Sell Orders

The stocks price then rallied, went up to hit the sell stocks trading limit order, & afterwards the stocks price continued to move downwards in direction of the original stocks trading downward trading trend.

Stocks Price Hits Sell Limit Stocks Order, Sell Stocks Trading Limit Order Now Changes to a Sell - How to Use Sell Limit Stocks Trading Orders

When the stocks price hit the set sell limit order level the order changed to a sell order, this is therefore a good technique to sell at a better stocks price after a retracement.