What is Difference between Market Order?
There are different types of indices trader orders which a trader can use to trade in Indices.
At the foundation of successful indices trading is making use of the correct index order for the correct purpose. The most important things to remember about is indices orders: Always understand the indices orders you place and never place a index order which as a trader you are not entirely knowledgeable about. Definitions of the commonly used types of indices orders:
Limit Indices Order and Stop Indices Order
Indices Market Order
Market order is the most basic type of indices order, market order is used to buy or sell at current ask or bid quote trading indices price. This refers to the quoted stock indices price which pops up on your indices trading platform.
This type of stock indices order is used for buying or selling according to the current exchange rate quotation in indices trading, the execution is instant. The minute you want to enter a indices trade you can buy & sell at the current stock indices price at a click of a button key using a indices market order.
Pending Stock Indices Orders
These are stock indices orders used to open a new indices trade position after the stock indices market reaches a indices price specified by the trader.
Entry orders are used to buy or sell when stock indices price when it attains a certain stock indices price target.
When a specific stock indices price level is reached or broken then a indices pending trading order is executed.
These Pending Indices Orders are used to enter a indices trade at a specified stock indices price level. It is almost impossible to monitor the indices market every second & this is why a indices order can be used by a indices trader. If you feel the stock indices market price may take a certain action, such as break through a specific stock indices price level that it has been touching but it has not been able to break, you would want to use an Indices Pending Trading Order. Once the stock indices trading market crosses your specified stock indices price level, your pending indices order trade order will then be executed.
There are two types of indices pending orders - stock indices limit order and indices stop order.
Limit Indices Order
An order to buy or sell at a specific limit.
An stock indices limit order can be used to buy below the current stock indices price or sell above the current indices price.
When buying, stock indices limit order is executed when the stock indices price falls to your limit area.
When selling, stock indices limit order is executed when the stock indices price rises to your limit area.
These Limit Indices Orders are placed by indices traders when they expect the stock indices trading market to bounce back after reaching the retracement stock indices price level at which the stock indices limit order was placed.
Buy Limit Indices Order Specifies to buy at a level below the current stock indices market price
Sell Limit Stock Indices Order Specifies to sell at a level above the current stock indices market price
Stop Stock Indices Order
A indices stop order is a pending stock indices order that is used to buy above the current stock indices price or to sell below the current indices price.
When buying, indices stop order is executed as the indices market goes up & hits buy stop level.
When selling, indices stop order is executed as the indices market goes down & hits the sell stop level.
- Buy Stop Indices Order Specifies to buy at a level above the current stock indices market price.
- Sell Stop Indices Order Specifies to sell at a level below the current stock indices market price.
What's the Difference between Stop Stock Indices Orders and Limit Stock Indices Orders in Indices Trading?
How to Differentiate Between Stop Indices Orders and Limit Indices Orders
Stop orders are set to buy above or to sell below current market indices price
Limit orders are set to buy or sell at a better stock indices price after a indices price retracement.
It is easier to first of all remember one concept. The easier concept is that of Stop Indices Orders - Stop Indices Orders are set above & below the current market indices price.
To learn how to set up these indices pending orders read the guides:
Setting up Indices Buy Limit Order & Sell Limit Indices Order on MT4
Setting up Indices Buy Stop Trade Order & Sell Stop Indices Order on MT4
What is Difference between Market Order - Stop Indices Order and Limit Indices Order
