Entry Limit Orders: Buy Entry Limit and Sell Entry Limit
Limit order definition - Entry limit is an order to buy or sell a Gold at a certain xauusd trading price which is a pullback area where price is predicted to pull back to before resuming the original trend. traders use them to buy or sell at better price. These types of orders are available in most of the online softwares, for our examples we will use MT4 platform.
An entry of this type can be used to open buy below the market level (up trend market pullback) or sell above the market level (down trend market pullback).
Buy limit - When buying, your entry buy limit order is executed when market falls to your set xauusd trading price. ( price pulls back down )
Sell limit - When selling, your entry sell limit order is executed when market rises to your set price. ( price pulls back up )
Entry orders are placed by traders when they expect xauusd trading price to bounce back after reaching to this level.
- Entry Buy Limit Orderbuy at a level below the current market level.
- Entry Sell Limit Ordersell at a level above the current market level.
Buy Entry Limit Example
In the examples illustrated and described below, the buy limit order was placed to open buy at trading price below the prevailing market trading price. Point B is point that it was set.
Limit buy order entry placed to buy below the current market trading price
The trading price then retraced and went down to hit the buy entry limit, and afterwards trading price continued to move upward in direction of the original Gold upward trend. When the limit buy order was hit by price it changed into a buy.
Price hits buy limit, order now changes to a buy
Sell Entry Limit Order
In the example shown and described below a the sell entry limit was placed to sell at a price above the prevailing market price. This is the level for the price pullback.
Entry limit sell order placed to sell above current market trading price
The trading price then rallied, headed upward to hit sell entry limit, and afterwards trading price continued to move down-wards in direction of the original downwards trend.
Price hits sell limit, order now changes to a sell
When gold trading quote got to the set level the order changed into a sell, this is therefore a nice technique to buy or sell at better price after a price pullback.
Setting Buy & Sell Limit Orders on MT4 Platform
To set up these orders in MetaTrader 4 software, Right Click on chart>>> Choose "Trading">>> Then Select "New">>> Then on the popup panel that pops up (illustrated below), under label "Type" select the option of "pending" instead of "market execution">>> Under the pending order options select the pending order type: for This trade select either "Buy Limit Order" or "Sell Limit Order" depending on whether you want to place a pending buy or sell.
Putting Buy & Sell Limit Orders on MetaTrader 4
Sometimes, setting the point value to place your trade can be tricky, setting to far might mean your entry market limit not getting executed, the best tool to use is Fibo retracement indicator and use the 38.20% retracement levels. This retracement level is watched by many traders and entry orders tend to crowd at this level, therefore the best odds to catch a trade would be presented by using the 38.2% Fibo retracement level.
Fib Retracement Tutorial - Fibonacci Retracement Tutorial
Tip: in Gold online trading, If you want to set a good take profit level (not retracement level, take profit level) for your trades you can use the Fibonacci expansion 100% level for the best take profit area. To Read more on Gold Fibo Retracement and Fibo expansion use the right navigation menu section Technical Analysis.
Fib Expansion Tool Tutorial - Fib Expansion Tool Tutorial
