Stop order

A stop order becomes a market order when price reaches your level: a buy above the current price, a sell below it.

A stop order is used to enter in the direction of a move: buy if price breaks resistance, sell if it drops below support. On MetaTrader these are Buy Stop and Sell Stop orders.

It is also how a stop loss works: once the level is hit, the position is closed at market. Like any market order, it can suffer slippage, especially in a gap.

There is a variant, the stop limit order, which turns into a limit order instead of a market order. It protects against slippage, but may not be filled if price jumps past your level.

The full lessonOrder types: market, limit, stop, OCO and trailing stopMarket, limit, stop, stop-limit, OCO, trailing stop, take profit and stop loss orders: how each trading order type works and when you should use each one.