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Limit Order


An instruction to deal if a market moves to a more favorable level (i.e. an instruction to buy if a market goes down to a specified level, or to sell if a market goes up to a specified level) is called a Limit Order. A Limit Order is often used to take profit on an existing position but can also be used to establish a new one.

Example
EUR/USD is trading at 1.2713/16. You believe the Euro is going to strengthen, but think that EUR/USD will fall back to below 1.27 before it goes higher. You put on a Limit Order to buy EUR/USD 1´000´000.-- at 1.27. Your Limit Order is executed when EUR/USD is offered at 1.27.





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