Stop Loss, Limit & Take Profit Orders

What is a Stop Loss?

Forex trading is terribly rapid. In the space of nano-seconds, millions can change hands – this doesn’t just happen once in a while, it happens every day.

Every forex trader knows this, and uses the protection of stop losses so that a major shift in the value of a given currency against expectations doesn’t cost all the money in the account.

The Best Forex Brokers + Trading Platforms

Broker	Our Rating	Description	Minimum Deposit	Regulation	Visit
XM	5	Free forex signals + market research Online education and webinars Fee free withdrawals and deposits	$5	CySEC, FSP, ASIC	Visit Broker XM ReviewROTW	Risk Warning: Your capital may be at risk
Plus500	5	No commissions and low spreads Advanced trading tools Minimal account fees	€100	FCA, CySec :	Visit Broker Plus500 ReviewT1 ROTW	Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 80.6% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
eToro	5	The leading Social Trading platform with 4.5m traders Follow other traders or be a leader Personal service and VIP perks	$200	FCA, CySec, ASIC	Visit Broker eToro Review	Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 65% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
IQOption	4.5	Stylish & Powerful Platform Trade Bitcoin + 12 Other Top Cryptocurrencies Plus Forex, Options, Stocks & ETF Trading	$10	CySec	Visit Broker IQOption Review	Risk Warning: Your capital may be at risk
Easy Markets	4.5	Free Guaranteed Stop Loss Segregated funds at top tier banks Fixed spreads & negative balance protection	$100	ASIC, CySEC	Visit Broker Easy Markets ReviewT1 ROTW	Risk Warning: Your capital may be at risk
LCG (London Capital Group)	4.5	World class trading platform Expert market analysis FCA Regulated and traded on the LSE	0	FSA	Visit Broker LCG (London Capital Group) ReviewT1 ROTW	Risk Warning: Your capital may be at risk
AVATrade	4.5	Trusted, regulated broker with 10 yrs experience Multi award winning company Segregated accounts with leading banks	$100	Central Bank of	Visit Broker AVATrade ReviewT1 ROTW	Risk Warning: Your capital may be at risk
ETX Capital	4	Choice of two professional trading platforms – TraderPro and MT4 Free trading course for deposits over £1,000 Choice of Forex, CFDs, Spread Betting and Cryptocurrencies	€100	FCA	Visit Broker ETX Capital ReviewT1	Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 79.6% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Markets.com	4	Tight spreads without commissions Advanced charting tools	$100	CySec	Visit Broker Markets.com ReviewT1 ROTW	Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
FBS Markets.	4	Split second execution No requotes Range of accounts	$5	IFSC	Visit Broker FBS Markets. ReviewROTW	Risk Warning: Your capital may be at risk
InstaForex	3.5	'Asia's top broker' Wide choice of leverage options	$1	RAFMM, The Federal	Visit Broker InstaForex ReviewROTW	Risk Warning: Your capital may be at risk
EXNESS (NZ) Ltd.	3.5	Instant fund withdrawals - no commissions Tight spreads from 0.1 points Unlimited leverage	-	FDR (NZ), CySEC	Visit Broker EXNESS (NZ) Ltd. ReviewT1 ROTW	Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 74-89% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
HF Markets Ltd. (HotForex)	3.5	8 Trading Platforms Spreads from 0.1 Pips $0 fees on deposits	$5	FSC & CySEC	Visit Broker HF Markets Ltd. (HotForex) ReviewROTW	Risk Warning: Your capital may be at risk
FXPrimus	3	Trusted by 100,000s of traders Fully licensed in the EU by CySec Tight spreads and fast withdrawals	$100	FSC Mauritius	Visit Broker FXPrimus ReviewROTW	Risk Warning: Your capital may be at risk
OLYMP TRADE	2		10		Visit Broker OLYMP TRADE Review	Risk Warning: Your capital may be at risk

Broker rankings last updated 17/11/2018 18:45

Once a trade is set in motion you cannot stop it, except to close the trade. You may not even be able to click the mouse quickly enough to keep from racking up huge losses.

A stop loss closes a trade automatically when the currency falls to given level. Similarly a stop loss can close a trade when a currency rises in value if you have bet on its going lower.

What is a Limit-Order?

A limit order allows an investor to set the minimum or maximum price at which they would like to buy or sell before making a trade.

What is a Take-Profit Order?

A take-profit order allows an investor to set the closing price of a trade before making the trade.

What is a Trailing Stop Loss Order?

A Trailing Stop Loss permits you to protect your account balance while locking in profit.

In a trade that, for example, is long on a certain currency, you may set your stop loss at a certain point. Suppose the currency pair moves higher? The Trailing Stop loss will also move higher, remaining at the distance you specify below the current value of the pair, so that you can protect your account while getting the value of the trade.

Let’s take the example of trade in which USD/JPY starts at 0 (this is hypothetical). You set your Trailing Stop Loss at -150. Now USD/JPY moves up to 200. Your Trailing Stop Loss Moves up to 50. Your profit of 150 is protected by the stop loss. Now the pair moves higher, to 400. Your Trailing Stop Loss moves to 250. Each time your profit is locked in.

Suppose the pair suddenly drops back to 0? Your trade is stopped out at 250, and you have gained 250. But, you must remember that the Trailing Stop Loss will close your trade, regardless of conditions.

This is not always desirable (sometimes, in certain complex trading movements, a move lower is expected followed by a move higher. Using a Trailing Stop Loss bars your access to this kind of trading strategy).