Lesson 11 of 69
Order types in detail
8 min read
Chapter checkpoints
0/5- Market orders: in now, at whatever the price is
- Where each order type sits
- Limit orders: wait for a better price
- Stop orders: wait for confirmation
- Practical notes
Optional — tick a chapter as you finish it to keep your place inside this lesson.
There are only two questions an order answers: do you want in right now, or do you want in at a specific price? Everything else — the four pending order names that confuse every beginner — falls out of that one distinction plus whether your price is above or below the market.
Market orders: in now, at whatever the price is
A market order executes immediately at the best available price. A buy fills at the , a sell fills at the , so you start every market order down by the . In fast conditions the fill can come in slightly worse than the price you clicked — that difference is , and it is worst around news.
- Use it when: being in the trade matters more than the exact entry price.
- Watch out for: wide at the session , at , and around scheduled news releases.
Where each order type sits
Limit orders: wait for a better price
A limit order asks for a price more favourable than the current one. You are betting that price comes back to you before it goes without you — the classic pullback entry.
- Buy limit — placed below the current price. You expect a dip into or a , then a bounce.
- Sell limit — placed above the current price. You expect a rally into or a , then a .
- Advantage: a tighter stop and a better , because you enter closer to your invalidation level.
- Trade-off: if price never returns, you simply miss the move. That is the cost of demanding a discount.
Stop orders: wait for
A stop entry order asks for a worse price than the current one — deliberately. You only want in once price has proven it can break through a level, which is why these are the standard entries.
- Buy stop — placed above the current price. It triggers when price breaks up through resistance or the high of a pattern.
- Sell stop — placed below the current price. It triggers when price breaks down through support.
- Advantage: you are never in a trade that failed to move. The market has to come and get you.
- Trade-off: a worse entry, a wider stop, and exposure to false breakouts that snap straight back.
| Order | Placed | You are saying | Typical use |
|---|---|---|---|
| Market | At the current price | Get me in now | The setup is live and the level has already been hit |
| Buy limit | Below current price | Only buy if it gets cheaper | Buying a pullback into support or a demand zone |
| Sell limit | Above current price | Only sell if it gets more expensive | Selling a rally into resistance or a supply zone |
| Buy stop | Above current price | Only buy if it breaks higher | Breakout above a range, triangle or neckline |
| Sell stop | Below current price | Only sell if it breaks lower | Breakdown below a range or support |
The one-sentence memory aid
Limits want a better price and sit on the far side of the market from your direction; stops want confirmation and sit on the same side price must travel to. If you can say which of those two you want, the platform's four names stop mattering.
Practical notes
- Pending orders can carry a and attached, so the whole trade is defined before it exists. Do that.
- Set an expiry on pending orders. A buy limit placed on Monday's chart is meaningless by Thursday.
- A pending order does not protect you from a : if price opens past your level, it fills at the next available price.
- The word 'stop' means two different things — a stop entry order opens a trade, a stop loss closes one. Read the order ticket carefully.
Key takeaways
- A market order fills now at the current price; a pending order waits for your price.
- Buy limit and sell limit wait for a better price; buy stop and sell stop wait for a breakout.
- Stop loss and take profit are exit orders that work while you are away from the screen.
- In fast markets, orders can fill away from your level — that is slippage, not a broker error.
Knowledge check
3 quick questions — your best score is saved to your progress.
1. Which order fills immediately at the current market price?
2. A buy limit is used when you want to…
3. Your stop fills 3 pips worse than your level during news. What happened?
Progress is saved on this device.
Related lessons