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A market order buys or sells immediately at the best available current price. It's the simplest order type, but you have limited control over the exact price you get, especially in fast-moving markets.
A limit order only executes at a specific price or better — a buy limit sits below the current price, a sell limit sits above it. It's how traders enter a position at a level they've planned for in advance, rather than chasing the current price.
A stop order triggers a market order once the price reaches a specified level — commonly used for stop-losses or for entering a breakout once price moves past a certain point. Understanding the difference between these order types is a prerequisite for almost every other strategy on this site.
Real-World Example
A trader watching gold at $2,050 wants to sell immediately at whatever the current price is, so they use a market order and get filled within a second, roughly at that price. A second trader believes gold will pull back to $2,030 before continuing higher, so instead of watching the screen all day, they place a buy limit order at $2,030 that will only fill if price actually reaches that level. A third trader wants to catch a breakout above $2,070 but only if it happens, so they place a buy stop order at $2,070 — three completely different order types used to express three different views on the same instrument at the same moment.
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