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Explaining Limit Order?

Where do you set them? Back testing your system can be beneficial here. You can check thru the last months and years of markets that would trigger a trade under your system and work out what would have been the optimal setting for the limit order. Remember of course that past results are not always going to be repeated in the future.

Mostly you will want the limit order to be farther from your place to begin than your stop loss, even after spread is considered. This may mean that you just have to score a 50% success rate to be in profit. Setting the limit order at twice the pips of the stop loss, either before or after spread, could be suitable. this depends upon your system.

Using limit orders has another valuable benefit too. There’s no need to look at each tiny fluctuation of price until one or the other is triggered. This decreases stress and makes it less sure that you are going to panic and deviate from your original plan. So using limit orders in currency exchange trades leads to a happier, more rewarding trader.