What is the Difference between Sell Limit Order and Buy Limit Order in Indices Trading?

What is Buy Limit Order?

A buy limit order is an order to buy indices at a better trading price after trading price has retraced from its current zone.

A buy limit pending order is an order to buy at a lower trading price than the current price

A buy limit is only executed when the prices drops and retraces to the set buy limit zone.

What is Buy Limit Order Example?

Buy Limit Order definition - Entry limit is an order to buy a Trading at a certain price which is a retracement level where trading price is predicted to pull back to before resuming the original trend.

Traders use buy limit pending orders to buy at better market price. These types of buy limit orders are available in most of the platforms, for our example we will be using MT4 platform.

An entry buy limit order of this type can be used to buy below trading market level (retracement in an up trend market).

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

Entry orders are placed by traders when they expect price to bounce back after reaching this zone.

• Entry Buy Limit Orderbuy at a level below the current market level.

What is Buy Limit Order Example?

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

Buy Limit Order Placed to Buy Below the Current Market Price - What's Buy Limit Order?

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

Buy Limit Orders Now Changes to a Buy Order - Buy Limit Order

What is Buy Stop Order?

What Does Buy Stop Order Mean?

A Buy Stop Order is an order to buy indices after the price rises to the set buy stop price zone.

The buy stop order is always set to buy above existing market prices.

Buy Stop Order

In the example described below a buy stop pending order was placed to buy at a level above current market trading price.

The trading price of the instrument then went up to hit buy stop pending order, and afterward price continued to move upwards.

What's Buy Stop Order?

Buy stop order is also used to set a pending order when there is a consolidation chart pattern on a chart. The Buy stop pending order is used to set a buy order just above the consolidation chart pattern as illustrated below so that if there is a price break out upwards after the consolidation pattern then a new buy order is opened - by buy stop order once the buy stop price set is reached.

Placing Buy Stop Order in a Break Out - Buy Stop Order Definition Described and Example

A Buy trade was generated from the above buy stop pending order when the price broke a resistance level in the first examples & when there was an upwards price break out after a market consolidation chart pattern on the second buy stop order examples.