Definition – What does Buy Limit Order mean?
A buy limit order is a forex trading order that opens a new long position or adds to an existing long position when a preset price level is breached. A buy limit order is set in advance of price action – that is, above the current buy quote for a currency pair – so that a trader can ensure a trade will take place without actively watching the chart and manually entering the order. A trader can set multiple buy limit orders to add to a position as the price action rises.
ForexTerms explains Buy Limit Order
A buy limit order is an essential tool for automation certain trading strategies. If a buy limit order is combined with a take profit order and a stop-loss order, it creates a trade that will close out without the trader’s active involvement.