Placing Orders using MT4

Opening a Position

There are multiple ways to enable the order window in Metatrader:

• You can right click on the market watch window at the left side of your
   MT4 platform and select "New Order"

• You can press the F9 key which is a quick key command you can use

• Select Tools -> New order

• Right click on the chart of the pair you want to trade and choose Trading
   -> New Order from the context menu; or

• The easiest way is to; double click on the Forex pair you would like to
   trade on in the "Market Watch" window.

Below is what the order window looks like:

Immediate Execution Orders (market entry orders)

The order window is fairly simple to navigate. On the left of the order screen is the current Forex tick chart of the pair you are about to take a position in. The two lines represent the bid/ask values, which are also shown in large numbers in the box. Recall, that if you buy a Forex pair you are getting in at the ask price (higher number) and if you sell a Forex pair you are getting in at the bid price (lower number). The simplest way to execute an order now, is to either hit the red "sell" button or the blue "buy" button.

An immediate order is a buy or sell that you want executed immediately at the current market price. As soon as you press the buy or sell button Metatrader will show you a confirmation box. Here you can view the vital information about your trade and confirm entry.

Before entering a market order you need to pay attention to a few things:

• Symbol - This is the currency pair or the financial instrument that you
   would like to speculate on.

• Volume - This is the number of lots that you will be trading.

You can also add a stop loss order and a take profit order to your market entry order right away. What this means is, if you are placing a trade you can enter an order to protect yourself and get out of a position if the market moves in a certain amount of pips against you and then you can enter a take profit order that will lock in your profits once the market has moved a certain amount of pips in your direction. By using Metatrader 4 you can enter these protective orders along with your "normal" orders so you don't have to worry about adding them later.

Once you confirm your order by clicking the OK box the new position will be listed in the "Trade" tab of the "Terminal" window. This means that you just entered a position on the market order and are now in a trade.

Pending Execution Orders

A pending entry order is an instruction to get into a position when a price reaches a predetermined level that you have preset. If the price never reaches the level you specify, the order is never executed.

Essentially there are 2 types of pending entry orders; entry stop orders and entry limit orders.

Here is a breakdown of each order type and the logistics behind it:

Limits and Stops
There are four kinds of pending execution orders you can place:

• Buy Limit - An order to buy a currency at a price BELOW the current
   market price. You will want to enter this order when you want to get in the
   market at a price that is lower than the current price.

• Buy Stop - An order to BUY a currency at a price ABOVE the current
   market price. You will want to place this order to enter your position when
   a certain price level is crossed. This order type is typically used on break
   out trades.

• Sell Limit - An order to sell a currency at a price ABOVE the
   current market price. You will want to enter this order to get in short when
   the price moves higher.

• Sell Stop - An order to sell a currency at a price BELOW the
   current market price. You will want to place this order to enter short once
   a specific level has been broken down.

Below is a graphical representation of the various order types. The bars in the black represent the instrument price at the time of order entry and the line represents where the order is placed and the direction of your trade.

Below is a picture of the pending order entry box on the Metatrader 4 platform:

As with an immediate order the left side of a pending order screen shows a brief tick history of the currency pair, both bid and ask. The currency symbol, volume, stop loss, and take profit work the same as with an immediate order.

However, pending orders contain several more parameters to help MT4 understand when and if to actually place the order.

• Price - Clearly, price is the most important parameter in a pending order.
   If you specify a buy at a price 20 pips away from the current price, MT4
   will watch the market and execute the order if that price level is reached.

• Expiry - You can set an order to stay in place indefinitely, or you can
   place an expiration on it. Using an expiration date and time allows you tell
   MT4 to watch the market and execute an order at a certain price, but
   allows you to tell MT4 to cancel the order after a certain amount of time.
   The amount of time can be minutes hours or days away from the present
   moment, making the feature quite useful.

Fills

It's extremely important for you to understand that all prices you actually get are subject to the way your broker responds to the MT4 commands sent to it. During volatile market conditions your order may be filled by the broker at a price different from your buy or sell levels. This possibility of not getting your price (known as being "slipped") is also a danger on an immediate order's stop loss and/or take profit settings.

It's important to understand your broker's policy on dealing with slips before you start trading with them.

One key aspect of the stop order that you need to understand is that it becomes a market order after the stop price is triggered. Once the order becomes a market order you may be filled at a price higher or lower than the stop price that you set to enter the market.