Forex Pending Orders Explained: Buy Stop, Buy Limit, Sell Stop, Sell Limit

Learn what Forex pending orders are and how Buy Stop, Buy Limit, Sell Stop, and Sell Limit work. Beginner-friendly guide with examples to trade smarter.

A pending order in Forex trading is an order that you place with your broker to open a trade at a specific price. Pending orders do not get activated immediately, as a market order does, but wait until the appropriate price is reached. This assists traders in planning entries without having to monitor charts at all times.

Traders can use brokers such as Beirman Capital to place various kinds of pending orders, including Buy Stop, Buy Limit, Sell Stop, and Sell Limit, which makes it easier to trade with discipline as a beginner.

Difference Between Buy Stop, Buy Limit, Sell Stop, and Sell Limit

Orders pending can be confusing initially, but they are merely instructions to the broker to buy or sell at this price. The only difference between them is whether you anticipate the price to increase or decrease before your order is triggered.

Let’s break them down:

Buy Stop

A Buy Stop is set above the existing price.
It is used by traders when they believe that the price will increase further once it reaches a specific level.

Buy Limit

A Buy Limit is set at a lower price.
It is used by traders when they anticipate that the price will decline initially and then increase.

Sell Stop

A Sell Stop is set below the current price.
It is applied when traders believe that the price will continue to decline after breaking a level.

Sell Limit

A Sell Limit is set above the current price.
It is used by traders who anticipate an increase in price followed by a decline.

Order Type	Placed Above/Below Current Price	Used When You Expect	Example Situation
Buy Stop	Above current price	Price will continue rising	Entering a breakout trade
Buy Limit	Below the current price	Price will fall, then rise	Buying at the support level
Sell Stop	Below the current price	Price will continue falling	Entering a downside breakout
Sell Limit	Above current price	Price will rise, then drop	Selling at the resistance level

What is a Buy Stop Order in Forex?

A Buy Stop order in Forex is a form of pending order that is set above the current market price. It is telling your broker: Buy this currency pair when the price exceeds the level I have set. This order is commonly applied when traders are of the opinion that the price will keep on increasing after it crosses a specific level.

To illustrate, suppose that the EUR/USD is at 1.1000. When you set a Buy Stop at 1.1050, the trade will not be activated until the price hits 1.1050 or above. The order remains pending until that time. Buy Stops are often used by beginners to trade breakout trades, where the price breaks resistance and runs up with strong momentum.

The advantage of a Buy Stop order is that you do not have to sit in front of charts all day. Rather, the order is automatically triggered when the market reaches your desired level. This assists traders in getting into the market when the time is right and not making emotional trading decisions.

At Beirman Capital, Buy Stop orders can be placed easily with a few clicks. This type of order is significant to understand since it educates beginners on how to trade in a disciplined manner and plan, rather than pursue the market.

What is a Buy Limit Order in Forex?

A Buy Limit order in Forex is a pending order that traders set at a lower price than the current market price. It instructs the broker: Open a buy trade when the price drops to my selected level and then begins to move up. This type of order is highly favoured as it enables traders to purchase at a lower price and capitalise on future upward trends.

As an illustration, when EUR/USD is trading at 1.1000 and you think that the price will first fall to 1.0950 and then rise, you can place a Buy Limit at 1.0950. The order will remain pending until the market attains that price. The trade is automatically opened once triggered.

Buy Limit orders are frequently used by traders who believe the market will rebound at a support level or by traders who wish to buy at a discount before the next rally. This is a popular strategy used in Forex technical analysis and is useful to beginners who wish to pre-plan their trades.

The main benefit of a Buy Limit is that you do not have to monitor charts constantly. It assists in eliminating emotions and makes sure that you only get into the market when the conditions are in line with your trading plan.

What is a Sell Stop Order in Forex?

A Sell Stop order in Forex is a pending order that is set below the current market price. It informs the broker: Sell this currency pair when the price falls to my selected level and proceeds to fall. It is used by traders when they anticipate the market to breach a support level and continue to fall.

For example, when GBP/USD is trading at 1.2500 and you believe that the price will go down further once it breaks 1.2450, you can place a Sell Stop at 1.2450. The order will not be activated immediately. It will be activated only when the market hits 1.2450 or below.

Sell Stop orders are highly applicable in breakout trading strategies where traders wait until the price breaks an important level and proceeds to move in that direction. This assists in capturing good downward momentum without having to monitor charts all the time.

To trade with discipline, a Sell Stop order is a good idea to use as a beginner. It makes sure that you do not venture into the market until the trend is evident and favourable to you. This facilitates easier risk management and the elimination of guessing the market direction.

What is a Sell Limit Order in Forex?

A Sell Limit order in Forex is a pending order that is set above the current market price. It informs the broker: Sell this currency pair when the price increases to my selected level and then begins to fall. This order is used by traders when they anticipate that the market will hit a resistance point and then turn down.

To illustrate, when USD/JPY is at 150.00 and you think that the price will increase to 150.50 and then decrease, you can place a Sell Limit at 150.50. The order will be pending and will only be activated once the price hits that level. The trade is automatically opened once triggered.

Sell Limit orders are usually applied in Forex technical analysis to buy at a higher price and capitalise on a downward trend. This is a good strategy to use when one is a beginner and wishes to plan trades beforehand and not make decisions based on emotions.

The primary advantage of a Sell Limit order is that it enables traders to sell at a higher price and gain possible profit in case of market reversals. Trading with this type of order assists beginners in trading in a more systematic manner and helps them have a clear trading plan.

Common Mistakes Beginners Make with Pending Orders

Simple mistakes that many beginners commit when using pending orders in Forex can cost them money or lost opportunities. Being aware of these errors will make you a smarter trader and prevent needless losses.

1. Ordering Too Near or Too Far.

Other traders will put Buy Stop, Buy Limit, Sell Stop or Sell Limit orders too near the current price, and this may cause the trade to be triggered too soon, or too far, and may never be triggered at all.

2. Disregarding Market News and Volatility.

Unfilled orders may be dangerous when the market is volatile or when there is news. Prices may shoot up and hit your order at a level that you did not expect, and incur losses.

3. Not Using Stop Loss

Most novices forget to add a stop loss to their pending orders. Stop loss is significant to curb losses in case the market works against your trade.

4. Overcomplicating Orders

Attempting to make too many pending orders simultaneously may disorient amateurs. It is preferable to concentrate on one or two trades at a time and monitor their performance.

With these errors avoided, novices can better utilise Buy Stop, Buy Limit, Sell Stop, and Sell Limit orders. Successful Forex trading is about planning trades and having a clear strategy.

Final Thoughts

Orders such as Buy Stop, Buy Limit, Sell Stop, and Sell Limit are pending orders that are very useful to Forex traders, particularly beginners. They assist in pre-planning trades, trading at the appropriate time, and minimising emotional trading. It is easy to set these orders and trade with discipline using platforms offered by brokers such as Beirman Capital. In case you are new or need some advice on how to make pending orders, you can contact us and get simple instructions and help. These strategies can be practised on a demo account to gain confidence before trading live.