What are the different trading order types?

Here are the basic trading order types, and when you will want to use them. A Market order is the simplest order type. There are market orders to buy and market orders to sell. A market order gives you whatever price is available in the marketplace.

How many types of orders do day traders use?

That said, basically there are4 types of orders that retail day traders will use and that underly more sophisticated orders. The same order types are used in forex markets and stock markets, as well as in short term trading and postion trading. A market order instructs a broker to buy or sell an instrument at the next available price.

What is a stop order in trading?

A stop order is used toenter the market at a less favourable price. In the case of a buy-stop order, the order is placed above the current market price and in the case of a sell order it is placed below the current market price. The most common use of stop orders is a stop-loss order.

How do traders use order books?

Traders can also use this tool to spot potential support (a large number of purchase orders at a specific price) and resistance (a large number of sell orders at or near a particular price) levels. An order book example is that of NASDAQ TotalView. It claims to be the most comprehensive book available in the U.S. and possibly worldwide.