Stop-Limit orders are a powerful tool that traders use to intelligently manage their trades and protect their investments from unexpected losses. The image shows how these orders can be used correctly. Let’s explain it step by step:
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Buy Orders 💰
1. Buy Stop:
The system automatically executes a buy order above the current price.
It is used when you believe the price will rise after passing a certain point.
2. Buy Limit:
A buy order is placed below the current price.
It is used when you expect the price to fall first and then rise afterwards.
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Sell Orders 📉
1. Sell Stop:
The system automatically executes a sell order below the current price.
It is used when you expect the price to continue falling after breaking a certain point.
2. Sell Limit:
A sell order is placed above the current price.
It is used when you expect the price to rise first and then fall later.
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When to use these commands? 🤔
Risk management:
To reduce potential losses when an unexpected market movement occurs.
Monetization:
To secure profits when the price reaches a certain target level.
Automated trading:
To avoid constantly monitoring the market.
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Tips for beginners 📝
1. Test before real application:
Try using the commands on a demo account to understand how they work.
2. Choose your levels carefully:
Based on market analysis (such as support and resistance).
3. Use capital management:
Don't risk more than you can afford to lose.
Warning ⚠️
Using wrong orders can lead to unexpected losses. So, learn well before executing and always be careful.
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