currency pair, the system will only allow you to place a limit order below the current market price, because this is the profit zone. Similarly, if you are long (bought) the currency pair, the system will only allow you to place a limit order above the current market price. Take-Profit orders help create a disciplined trading methodology and make it possible for traders to walk away from the computer without continuously monitoring the market.
Control risk by capping losses
Stop-Loss orders allow traders to set an exit point for a losing trade. If you are short a currency pair, the Stop-Loss order should be placed above the current market price. If you are long the currency pair, the Stop-Loss order should be placed below the current market price. Stop-Loss orders help traders control risk by capping losses. Stop-Loss orders are counter-intuitive because you do not want them to be hit; however, you will be happy that you placed them.
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