An order is your instruction to the broker to buy or sell. The type of order you choose determines how and when it gets filled. Getting this wrong is one of the most expensive beginner mistakes.
Market Order
A market order executes immediately at the best available price. You use it when speed matters more than price — you want in now.
During high volatility (e.g. news releases), a market order can fill far from the price you saw — this is called slippage. Never use market orders around major news.
Limit Order
A limit order sets a specific price. A buy limit waits for price to drop to your level; a sell limit waits for price to rise to your level. You get your price or better — or no fill.
- ▸Buy Limit: placed below current price — you want to buy cheaper.
- ▸Sell Limit: placed above current price — you want to sell higher.
Stop Order (Stop Entry)
A stop order becomes a market order once price crosses your stop level. You use it to enter when momentum confirms a direction — you'd rather get a slightly worse price than miss the move.
- ▸Buy Stop: placed above current price — enter on a breakout upward.
- ▸Sell Stop: placed below current price — enter on a breakdown.
Stop-Loss Order
A stop-loss is the most important order in trading. It automatically closes your position at a defined price to limit your loss. No serious trader enters without one.
Always place your stop-loss before you enter — never move it wider after the fact. If your stop gets hit, the trade idea was wrong. Accept it.