The 6 Most Common Trading Orders Every Trader Should Know

Estimated reading time: 4 minutes

When you place a trade in any financial market (stocks, forex, crypto) you’re not just clicking “buy” or “sell.” You’re actually sending a specific type of order to the market.

Each trading order type has a different purpose. Some help you enter quickly, some help you exit with precision, and others protect you from big losses.

Whether you’re day trading or investing long-term, understanding the main types of trading orders is essential.

1. Market Order 🟢

A market order is the simplest and fastest type.

What it does: Buys or sells immediately at the best available price.
When to use: When you want quick execution and are okay with the current price.

✅ Pros: Fast, easy, guarantees execution
❌ Cons: You may not get the exact price you see (called slippage)

Example: You see EUR/USD at 1.1200 and place a market buy order. Your order fills at the best price available—even if it’s 1.1203.

2. Limit Order 🔵

A limit order lets you set the exact price you want to buy or sell at.

What it does: Waits until the price reaches your set level, then executes.
When to use: When you’re targeting a specific entry or exit point.

✅ Pros: Price control, no slippage
❌ Cons: No guarantee your order will be filled

Example: You want to buy a stock at $100, but it’s trading at $102. You place a limit order at $100. It won’t fill until the price drops.

3. Stop Order (Stop-Loss) 🔴

A stop order becomes a market order after the price hits a certain level.

What it does: Triggers a buy or sell after the price crosses your stop level.
When to use: To protect profits or limit losses (stop-loss), or enter on breakouts (stop-entry).

✅ Pros: Risk control
❌ Cons: Can trigger in volatile markets and slip past your price

Example: You buy Bitcoin at $40,000 and set a stop-loss at $38,000. If the price drops, your order sells automatically to prevent further loss.

4. Stop-Limit Order 🟠

A stop-limit order combines a stop order and a limit order.

What it does: Triggers a limit order instead of a market order when the stop price is hit.
When to use: When you want to avoid slippage on your stop orders.

✅ Pros: More price control than a regular stop
❌ Cons: Risk of not getting filled during fast moves

Example: You set a stop at $50 and a limit at $49.50. If the price falls to $50, your order only fills at $49.50 or better.

Read More: Complete Guide to Otet Trading Accounts

5. Trailing Stop Order 🔁

A trailing stop moves with the market price to lock in profits.

What it does: Sets a stop-loss that adjusts as the price moves in your favor.
When to use: When you want to protect profits in a trending market.

✅ Pros: Auto profit protection
❌ Cons: Can trigger early in volatile markets

Example: You buy gold at $1,900 and set a 20-point trailing stop. If gold rises to $1,950, your stop moves up to $1,930.

6. OCO Order (One Cancels the Other) ⚖️

An OCO order is two orders linked together—when one executes, the other is canceled.

What it does: Lets you plan two scenarios (like breakout up or down) and manage both at once.
When to use: In volatile markets or around key levels.

✅ Pros: Flexible strategy setup
❌ Cons: More complex to set up

Example: You set a sell limit at $105 and a stop at $95. If the price hits $105, you sell and the $95 stop cancels automatically.

Quick Table: Types of Trading Orders

Summary

Mastering the types of trading orders is the first step toward becoming a smart, risk-aware trader.

Each order type serves a different purpose, fast execution, price control, or risk management. Knowing when and how to use each one helps you trade with confidence and discipline.

💬 Got questions about how to set these orders on your platform? Drop a comment and we’ll help!

❓ FAQ

What’s the safest type of trading order?

A limit order is usually safer in terms of price control, but a stop-loss order protects you from big losses.

Can I use more than one order at the same time?

Yes, platforms often support combinations like OCO or stop-limit orders.

Are these orders the same in all markets?

The core types are similar in stocks, forex, and crypto, though naming or rules may vary slightly.

Do I need a special account to place these orders?

Most brokers offer all these order types in standard trading accounts.