Get trading with Deriv MT5: Order types part 1
Welcome back to our course on Deriv MT5! In this lesson, we’ll explore the various order types available on the platform, which are fundamental for effective trading. Understanding how these orders work is essential, as they dictate how you enter and exit trades, ultimately affecting your trading outcomes.
Types of Orders Available
Deriv MT5 offers two primary categories of orders: Market Orders and Pending Orders, each serving unique trading needs.
Market Orders
A market order is focused on speed. When you place a market order, Deriv MT5 executes it by immediately buying or selling at the current best available market price. The emphasis here is on execution speed, which means you may not have control over the exact price at which your order is filled.
Example: Suppose you want to buy 1 lot of EUR/USD at a current price of $1.1250. If you execute the market order but the price changes to $1.1252 before it gets filled, your trade will execute at the new market price. This highlights how market orders can guarantee execution but not necessarily the price, especially in fast-moving markets.
Pending Orders
Pending orders allow for a more strategic entry into trades by waiting for specific market conditions to be met. There are several types of pending orders available:
- Buy Limit Order: Set at a price below the current market price. This order will execute if the market falls to this price, allowing you to buy at a better rate.
- Sell Limit Order: Set at a price above the current market price. This order is activated if the market rises to this price, allowing you to sell at a higher point.
- Buy Stop Order: This order is placed above the current market price, becoming active when the price surpasses the stop level, indicating a potential uptrend.
- Sell Stop Order: This order is set below the current market price, triggering when the price falls below a specified level, indicating a potential downtrend.
Conclusion
In this part, we have covered the primary order types in Deriv MT5, including market orders and pending orders. Understanding how to use these orders effectively can give you a significant edge in your trading activities.
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Get trading with Deriv MT5: Order types part 1
Welcome back to our course on Deriv MT5! In this lesson, we’ll explore the various order types available on the platform, which are fundamental for effective trading. Understanding how these orders work is essential, as they dictate how you enter and exit trades, ultimately affecting your trading outcomes.
Types of Orders Available
Deriv MT5 offers two primary categories of orders: Market Orders and Pending Orders, each serving unique trading needs.
Market Orders
A market order is focused on speed. When you place a market order, Deriv MT5 executes it by immediately buying or selling at the current best available market price. The emphasis here is on execution speed, which means you may not have control over the exact price at which your order is filled.
Example: Suppose you want to buy 1 lot of EUR/USD at a current price of $1.1250. If you execute the market order but the price changes to $1.1252 before it gets filled, your trade will execute at the new market price. This highlights how market orders can guarantee execution but not necessarily the price, especially in fast-moving markets.
Pending Orders
Pending orders allow for a more strategic entry into trades by waiting for specific market conditions to be met. There are several types of pending orders available:
- Buy Limit Order: Set at a price below the current market price. This order will execute if the market falls to this price, allowing you to buy at a better rate.
- Sell Limit Order: Set at a price above the current market price. This order is activated if the market rises to this price, allowing you to sell at a higher point.
- Buy Stop Order: This order is placed above the current market price, becoming active when the price surpasses the stop level, indicating a potential uptrend.
- Sell Stop Order: This order is set below the current market price, triggering when the price falls below a specified level, indicating a potential downtrend.
Conclusion
In this part, we have covered the primary order types in Deriv MT5, including market orders and pending orders. Understanding how to use these orders effectively can give you a significant edge in your trading activities.
Quiz
What defines a Market Order in forex trading?
What is a Buy Limit Order?
Trade with confidence
