The world of forex is quite vast and quite complex in nature and once you have decided to enter it, one of the first things which you would have to do is to set up your trading account and learn about the various types of orders that can be executed in the currency market.

Currency trading is quite similar to stock trading when it comes to the types of orders that you would be executing. In currency trading, just like the stock market, you have the option of going either short or long. In case of a short you are basically selling a currency pair and you would have to buy the pair sometime in the future. In case of a long you are basically buying a currency pair in order to sell it at a later time. You profit from a short if the price of the currency pair that you have sold goes down and you profit from a long if the price of the currency pair that you have bought goes up.

Apart from this when it comes to actual execution of the orders there are several different order types. The first and the foremost type is the spot market order. In case of a market order you buy or sell a currency pair at the market price and your order is placed as soon as you commit to buy or sell a currency pair. This means that you order is executed at the price that is currently prevalent in the market.

An entry order is another kind of order that is executed in the currency market. In case of an entry order, an order to buy or sell is set when the price of a currency pair reaches a certain predefined target.  This means that you have the option of setting up an entry order and your order would be executed the instant the price of the currency pair in the market reaches the value that you have defined at the time of placing the order.

After an entry or market order has been placed another kind of order comes into play. This is known as the limit or the stop order. These orders are used for the purpose of exiting a trade automatically and are generally executed to protect you from undue or loss or to consolidate your profit in the currency market. In case of a stop loss, the idea is to protect from losses by putting up a condition that if the price of the currency pair in the spot market falls to a certain level, your trade is closed and you exit from the market. A limit order on the other hand is used for the purpose of redeeming profits.  In case of a limit order you place an upper limit called the take profit which if reached leads to liquidation of your trade leading to a profit for you in terms of cash.

These are the few types of orders that are usually executed in the currency market. One needs to be aware of these in order to devise strategies to profit to the maximum from the market.

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