[Emini cycle] Market Order, Limit Order, system hangs, stop limit order spread!

Types of OrdersPlace orders is an art in itself. Beginners often do not know when to use market orders and limit orders. Used at different levels in different market conditions. But for the maximum is one that is more diverse. Include a limit order is necessary for the success of your business. I will not discuss this issue with the purchase, and logic and the mechanism is the same for a short circuit.

Market demand
In the market system, and you're basically giving instructions to a broker to buy at current prices. You can not specify the price at which you want to buy. Market orders may tend to slip in the markets move. For example, if you give a market order to buy 10 contracts, can be filled in 3 lots at $ 10, and three other lots in the $ 10.50 and a lot remaining 4 to $ 11.00. Accustomed to the use of the market system when we need to enter or exit the market quickly, for example when the market moves against you suddenly dramatically.

Reduce the demand
A limit order is different from the market system in that you can specify the price at which you want to buy. For example, if you specify that you want to buy a lot 2, $ 10, you will not get a job at prices above $ 10. Thus, one possible scenario is that you get both Lot 2 at $ 10, or a lot of $ 10 each and $ 9.50. Beauty is in order to reduce it will not get filled unless the price is better than what you specified.

Of downtime
And is known as a stop off. In day trading stop loss must be to survive your own. Some merchants do not put a stop loss because they control their own trading operations in real time. They feel they can intervene quickly enough to close the position when the situation turns against them. However, the fast-moving markets, you may very well lose $ 200 or more in a single contract in minutes. Put the stop loss order removes the frequency out of the psychological situation. In my experience, this is the absolute requirement, please to master and use to your advantage.

Suppose you long for the time being at $ 10, and you set the stop loss at $ 8, you are giving instructions to a broker to sell at the market price when the price drops to $ 8. When the price is higher than the $ 8, and a fixed stop-loss order in sleep, and will turn into a market order when the price reaches $ 8 to save you from further losses. Note that the stop is always used to get out of the situation. So if you are long, the stop loss order gives instructions for sale. If you are short, the stop loss order to give instructions to buy.

Stop Limit Order
Stop limit order is similar to the stop order, but it will turn into a specific order at a specified price in advance. For example, suppose you long to $ 10, and you set a stop limit order to sell at $ 8, when the price drops to $ 8, it becomes a limit order at $ 8. We point out that the end to ensure the best price at which the charge of the set. Therefore, the limit order at $ 8 means you get to fill in the $ 8 and up.