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- Closing a Position
Placing Orders using MT4
Closing a Position
Once you are in a position, your trade will appear in the terminal window when the trade tab is highlighted. You can find the trade tab at the bottom left hand corner of your platform.
Once the trade tab is selected and you see your trade you can right click on it and a box will come up that will have a "close order" option.
You can also access the close order screen by double clicking on the order.
Once you select the close order command the order number box will appear. To simply close the order instantly at the current market price, press the yellow close order button.
Stop Loss and Take Profit Orders
You can also place pending orders to close out your trades. The most popular of these types of orders are Stop Loss and Take Profit orders.
A stop loss order is an order placed to limit your losses on an open position. For a long position it is placed below the entry price and for a short position it is placed above the entry price. The basic premise, is if you enter the trade and add a stop loss order and if the market will move drastically against you, you will take a predetermined loss which is limited. One key factor to keep in mind is that a stop loss order always turns into a market order once the price crosses it. So you will not always be filled at your stop price you may be filled at a price that is worse.
A take profit order is a limit order to close your position once a certain amount of profit was reached. This is placed above the entry price on long positions and below the entry price on short positions. The basic premise here is to lock in your profit once it is attained, make sure not to give it back in case the price moves against you and that you are not in front of your computer.
You can place the stop loss and take profit orders either at entry or after you make a trade. As you can see there is a stop loss and a take profit option in the order entry box below.
Once you have entered an order with a stop loss and/or a take profit option attached to it you can modify the order.
In order to do this you will need to select the trade tab in the terminal window of your platform again (bottom left hand corner) right click on your open trade and select modify.
Here is what the modify order box looks like.
You can modify the stop loss and take profit levels by changing the numbers in the stop loss and take profit boxes above. There is a minimum distance that your stop loss and take profit orders can be from the current market price and entry price. Once your orders are legitimate the Modify button will become blue or red and you can modify your order.
A trailing stop order is a stop loss order that follows the market price of your instrument, as it moves in your direction. So as the price moves in your favor the trailing stop will move with the price. For example, if you select to buy a particular currency pair and place a 15 pip trailing stop loss the trailing stop will initiate as the price moves up 15 pips in your favor. And the trailing stop will move up with the price, so as the price moves up 1 more pip and you are 16 pips in profit and the stop loss will also move up 1 more pip from your original entry. Please keep in mind that the trailing stop can only move in the direction of your trade, never against it.
It is very important to note that no trailing Stop Loss order will be placed until the market moves in your favor as mentioned above. Therefore until this has happened, to limit losses, a separate Stop Loss would need to be placed manually.
In order to place a trailing stop, highlight the open position in the "Trade" tab of the "Terminal" window and right click to open the context menu and select the trailing stop option.