There are six types of pending orders in MetaTrader 5. This post will show you how each of them work and when you should use them.
These order types work on both the desktop and mobile versions of MT5.
Watch this video to see the different pending order types in action, or if you prefer the text version, it's provided after the video.
The 6 Types of MT5 Pending Orders
Here are the six types of MetaTrader 5 pending orders.
- Buy Stop
- Sell Stop
- Buy Limit
- Sell Limit
- Buy Stop Limit
- Sell Stop Limit
Now let's take a look at each pending order individually.
The first type of pending order is a buy stop. Use a buy stop if you expect price to go higher and break through the buy stop level.
This type of entry is perfect for a trader who is looking for a break above a previous candle or breakout of an important resistance level.
When price hits the buy stop level, your order turns into a market order and is executed at the market.
In this example, a trader might be looking for price to break the top of the range at 1.29858. So the trader would set a buy stop at that price.
When price hits that level, the buy stop pending order becomes a market order a long position is executed. In this case, price moved in the expected direction and the trade is now profitable.
A sell stop pending order is just the opposite. You are expecting price to go lower and drop below the sell stop level.
Now let's take a look at limit orders. These are for traders who don't want to pay too much for a trade. It's called a limit order because you limit the amount you pay for a trade.
When you use a buy limit order, you are expecting price to go in the opposite direction from the limit order price. Once price hits this level, a trade only gets executed if the price is below the buy limit price.
On the sell side, it's the same idea…but turned upside down. Traders use this order to be sure that they don't pay too much for a short trade.
When this price level gets hit, the short trade will only get executed if price is at this level or above.
Buy Stop Limit
As you have probably guessed, a buy stop limit combines characteristics of the stop and limit orders. Stop limit orders are the least used types of pending orders.
Basically, this is for traders who want all the of the benefits of a limit order, but also want to take advantage of price moving in the anticipated direction.
When price hits the buy stop limit level, the order turns into a buy limit order. From there, the trade won't be executed unless price is at the stop limit level or below.
It's worth noting that there's the possibility that this order might not get executed if price gaps above the stop limit price. This can happen in fast moving markets.
So if you're trading in a fast moving market and absolutely need to get in, then consider using a market order or a buy stop order.
Sell Stop Limit
A sell stop limit allows you to get in as price is moving down, but it won't allow the trade to be executed unless price is at or above the stop limit price.
Your trade might not executed if price gaps down quickly.
Frequently Asked Questions About Pending Orders
Now I'll answer a few questions about pending orders.
Why does my order not execute in some cases, when price has hit my pending order level on the chart?
There are several reasons why this could happen…
First, the spread could have been very narrow. Sometimes the spread is unusually narrow and price actually missed your pending order by a fraction of pip.
Second, your chart will either graph the bid or ask price. Therefore, maybe the bid price on your chart hit your pending order level, but the ask price needed to hit it, in order for the order to trigger.
The volatility of the market can play a role. In a fast moving market, price can “skip” over orders. This happens when computer systems don't have enough time to execute an order, as price moves quickly through it.
What about trailing stops or Order Cancels Order (OCO) in MT5?
MetaTrader 5 does not have these order types available. Trailing stops aren't that useful anyway, at least in the way that most software platforms implement them.
However, it can be useful to trail your stop loss by risk multiple or R. You can do that by using this EA.
If you would like to have the ability to do OCO, then you would have to program an EA yourself, or find a programmer to create one for you. Get a list of programmers here.
Why did price hit my pending order price at another broker, but not my broker?
Forex is a decentralized market. So there's no central exchange that sets the quotes for the currency pairs, like with most stock markets.
Price quotes at the different brokers are very similar because Forex is a very efficient market. When there is too big of a difference in price between liquidity providers, arbitragers come in and close that gap.
Therefore, there will always be slight difference in the quotes from various brokers and liquidity providers, but they usually don't get too far out of line.
So those are the 6 order types that you can use in MT5. They are available in both the desktop and mobile version of the software.
If you are just getting started with MT5 mobile, read this tutorial on how to use all of the features.
Each of these order types fills a specific purpose and will help you get into different types of trades. Don't be afraid to use them to help you get in at the right price.