Placing pending orders

Strategies based on placing pending orders usually give more profit than working withpending orders a standard trading scheme.

The reason for this phenomenon is the exclusion of the psychological factor from the trading process, which only interferes with making the right decisions.

A pending order allows you to set the price level upon reaching which a position will be opened; in addition, you also have the opportunity to immediately limit the amount of losses by setting a stop loss and plan the amount of profit using a take profit.

Placing pending orders is not as simple a task as it might seem at first glance; when setting it correctly, a number of important aspects and parameters should be taken into account.

In addition to purely technical issues, you should also determine where exactly to place a pending order, so that when triggered it would bring a profit and not be buried at a loss.

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Technical aspects of placing pending orders on Forex.

In order to place a new pending order (order), you should click on the “New Order” tab, usually located at the top of your trader’s trading terminal. After this, set the following parameters:

1. Transaction volume - the amount of currency you will buy or sell.

2. Type – pending order – after this you will have to select the direction of the transaction and the type of the order itself.

sell limit and buy limit – allow you to sell or buy a currency at a certain price, but I prefer to use the second option

buy stop or sell stop in this case, pending orders are opened if the price reaches a certain level, this option is suitable for breakout trading.

3. Price – here we set the price, upon reaching which our position will be opened.

4. Stop loss and take profit levels - it was not by chance that I placed them after setting the price, although in the trading terminal they go earlier. It’s just that in practice it’s more convenient to first set the trigger price, and then set the stop loss and take profit from it; in my opinion, this is more logical.

5. Place an order.

placing a pending order

Search for points for placing pending orders.

In principle, everything is clear about the technical issue, but where to place pending orders? There are several options for finding entry points, all of them are based on technical analysis of trend movement.

1. For a breakout - usually the price moves in a certain corridor, your task is simply to determine its extreme points and place an order a little further. In this case, the position will be opened if the price changes the dynamics of its movement and confidently moves on.

2. There is also another secret to finding the right entry point into the market, it is based on round numbers, for example, if for some time the trend is in the range of 1.2410 - 1.2490, then attractive entry points will be 1.2400 and 1.2500 , sooner than breaking this level, the price will rush further.

3. Against the trend - if you see that the price movement is replaced by constant rollbacks, then you can take a risk and place a pending order for double the value of such a rollback, in which case it will work if a trend reversal occurs.

4. On the news - there is not always time to wait for the release of important news, but it is known how the trend should react to its appearance, so a pending order is placed a little further than the border of the price channel.

For example, news should come out that has a positive impact on the price of the base currency in a currency pair, which means we place our order above the resistance level.

Stop loss and take profit.

Quite a sore subject when working with pending orders, because you do not control the transaction, so you should choose their size so that the order would work, but would not be buried during a rollback.

Therefore, before setting stop orders, analyze the magnitude of the rollbacks and use the result as a guide.

Stop loss is set to be slightly larger than the rollback (correction), take profit is slightly smaller, if you are confident in your calculations, try not to change levels during the trading process.

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