Types of Forex Orders Part II

A trader has different types of forex orders at his disposal. It is crucial to have a clear understanding of each forex order type to experience any success as a forex trader.

Some of the forex order types are:
Trailing Stop Loss Order: Trailing stop loss for any transacted currency pair keeps moving up as the forex market moves up but closes a trading position and books profits when the market starts falling. Trailing Stops are not Stop Loss Orders and they only go up according to the market but do not come down according to the market. For example, if the forex market moves up 30 PIPs, the trailing stop will coordinate the stop loss position accordingly but if the market starts falling, it will close the transaction and book profits.

The only difference between trailing stop and runner strategy is that the former is used to lock in profits while the latter limits losses. Runner strategy is basically a manual version of trailing stop and offers 100% guarantee against losses.

One Cancels Another Order (OCO): OCO allows a trader to book a stop loss order with a take profit order for one trading position. If any one of the two orders gets executed, the other will automatically be cancelled. For example, if the stop loss order for a trading position gets executed, the attached take profit will automatically be cancelled and vicè versa.

Entry & OCO Order Combined: This allows an OCO order to become activated if the pending entry order position is created.

To read about other types of forex orders, click here.