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