A stop-loss is a specific order type to buy or sell an FX pair at a designated price. Traders place these order types to limit losses on existing forex positions in the event of adverse price movements or trail profits. Stop-loss orders are of two types
- Stop-loss market order- Comprises only the stop-loss price. Once triggered, the trade would be closed out at the market price.
- Stop-loss limit order- Comprises a stop loss and a limit price. If triggered, the trade would be closed out between the stop loss price and the limit price.
