Question: What is "Buy Stop Limit" order on MT4/MT5 platforms? How does it work?
“Buy Stop Limit” order is the combination of the two order types which are “Buy Stop” and “Buy Limit”, as in being a stop order to place a Buy Limit order.
Please refer to the chart on the upper-right side of the below photo.
Red point indicates the current market price. Green and Blue points are the levels of pending orders.
“Buy Stop Limit” order works with 2 levels set in the market.
- The red point is the current market price
- The green point is the level when the pending order will be placed (no order will be executed at this level)
- The blue point is the price where the pending order is set, when the market price reaches to the green point
As you can see, as soon as the future Ask price reaches the stop-level indicated in the order (the Price field), a Buy Limit order will be placed at the level, specified in Stop Limit price field.
A stop level is set above the current Ask price, while Stop Limit price is set below the stop level.
This type of pending order is available on MT5 by default.
*Please note that if you don’t set the parameters as correct, your cannot place this pending order.
