Conditional Orders

Brief

The article describes the types of conditional orders.

Details

NOTE: Setting of Stops/Limits on entry orders or open positions will not work for United States based accounts. Please read NFA Compliance Rule 2-43(b).
There are three kinds of a conditional order:

Trailing Entry Stop and Trailing Entry Limit

Entry Stop/Entry Limit order can be automatically adjusted while the market price moves. Such order is called a Trailing Entry Stop/Trailing Entry Limit.

Trailing Entry Stop works as follows: if the market price moves up for sell orders/down for buy orders, then the order price moves automatically with the market price; if the market price moves down for sell orders/up for buy orders, then the order price remains fixed and, if the market price reaches the Trailing Entry Stop order price, the order will be executed and a new position opened.

Trailing Entry Limit works as follows: if the market price moves down for sell orders/up for buy orders, then the order price moves automatically with the market price; if the market price moves up for sell orders/down for buy orders, then the Trailing Entry Limit price remains fixed and, if the market price reaches the Trailing Entry Limit order price, the order will be executed and a new position opened.

Trailing Stop and Trailing Limit

Trailing Stop is a Stop order used for locking in the profit if the market price moves to the trader's advantage.

Trailing Stop order is automatically adjusted while the market moves in trader's favor: if the market price moves up for a Buy position/down for a Sell position, then the order price moves with the market price; if the market price moves down for a Buy position/up for a Sell position, then the order price remains fixed and, if the market price reaches the Trailing Stop price, the order will be executed and the position closed.

Trailing Limit is a Limit order used for preventing further losses if the market price doesn't move to the trader's advantage.

Trailing Limit works as follows: if the market price moves down for a Buy position/up for a Sell position, then the order price moves with the market price; if the market price moves up for a Buy position/down for a Sell position, then the order price remains fixed and, if the market price reaches the Trailing Limit price, the order will be executed and the position closed.

Trailing Step

The price of Trailing Stop/Limit and Trailing Entry Stop/Entry Limit orders moves automatically with the market price by a Trailing Step. The trailing step specifies the move of the market price by which the order price moves. The trailing step can be set by a trader (fixed step) or by the trading system (dynamic step). The trailing step is expressed in pips. Minimum and maximum sizes in pips are defined by the trading system.

Pegged Stop and Pegged Limit

A price of a Stop/Limit order can be specified either directly or through a distance from the market price. A Stop/Limit order a price of which is specified through a distance is called a Pegged Stop/Limit order. The price for a Pegged Stop/Limit order is calculated at once when the position is opened. Pegged Stop/Limit orders are useful when you do not know exactly at which price the position will be opened but you want to set Stop/Limit order on a certain distance from an order price at once the position will be opened. Pegged Stop/Limit orders are especially useful when you set a Stop/Limit order at a price which is very close to the market.

Orders Execution

Stop and Entry Stop orders are always executed in full amount at the best available price. Limit and Entry Limit orders are always executed at the price specified by the trader. If the price is unavailable, such orders will wait until the market reaches the specified price again. With Limit and Entry Limit orders, partial fills may occur.

Note: If the trader places two opposite entry orders and hedging is not allowed on the account, the execution of one order will open a position and the execution of the other order will fully or partially close this position.