What is Buy stop command? What are the rules of operation and how to use the Buy Stop order? Surely these are two questions that any trader is interested in when entering the Forex market. The Buy Stop order has long been an effective assistant tool, helping traders save time monitoring and optimizing profits with the least risk. If you do not clearly understand this type of order, this article Learn Forex Trading will provide complete information about the Buy Stop order for you.
Concept of what is Buy stop?
Buy Stop in Forex can be understood as a pending buy order. However, it will be purchased by traders at a higher price than the current market. For traders, this is one of the 4 most important types of pending orders to implement a breakout strategy. Because in some situations, when the market price is near a certain resistance level, traders expect the price to break the resistance area and push the price up strongly in the near future. Through that, the trader will set a Buy Stop order to receive this breakout.

For example, The current price of the EUR/USD currency pair is 1.003 (very close to the resistance level). In the future, traders who expect the price to break and surpass the resistance point should place a Buy Stop order at 1.0050. When the price reaches this threshold, the order will be automatically executed.
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What is the meaning of what is Buy stop order type in Forex?
Normally, the Buy Stop order is only used by traders investing according to the Breakout strategy. Especially, when investors want the price to continue to increase strongly and break the initial resistance area. Furthermore, Buy Stop Forex is also used by traders who do not have much time to monitor market fluctuations. Because the Buy Stop order will help investors stay updated and not miss any trading opportunities that can make a profit.
What benefits and limitations when using what is Buy stop command?

Although the Buy Stop order helps traders receive opportunities quickly, it still has some disadvantages that are difficult for users. So are there any benefits and limitations when using the what is Buy stop command?
Benefits of using Buy Stop Forex order to trade
Today, the Buy Stop order has become an indispensable order type in the Forex market. If you know how to use it effectively and make the most of the functions, it will definitely bring high efficiency, for example:
- Using the Buy Stop order helps traders save time monitoring the market. Instead, investors have to constantly update and Trend trading price movements, Buy Stop will do everything for them. Just wait for the price to break the resistance point, the pending order will immediately take effect.
- At the same time, Buy Stop also helps optimize profits and minimize risks. When the market moves in the original predicted direction, it means that the pending order will not be matched. That helps you limit losses when investing in the wrong market price trend.
Some restrictions on Buy Stop orders
Besides, the Buy Stop order in Forex also has risks, including:
- The price does not go in the direction of the judgment, affecting the order.
- Or sometimes, the price will only go up a little and then go down again without being able to reach the initial resistance level. From there, traders will miss the opportunity to trade and invest profitably for themselves.
When should you place a Buy Stop order in Forex?
So do readers know the best time to execute the what is Buy stop order? Mainly, the Buy Stop order is only used when you have identified a certain price level that is likely to break the resistance level and tend to increase even stronger. Thanks to that, the Buy Stop order can anticipate the breakout and create a profit. Here are some situations where you might consider placing a Buy Stop Forex order:
- You can place a Buy Stop order when the currency price is close to the resistance level.
- In case the currency price reverses from a support level, a Buy Stop order can also be applied. When the currency price declines and reaches an important support level, a Buy Stop order will be set to buy when the price reverses up.
- When market news creates big fluctuations in the Forex market. As predicted, if the value of the currency pair increases sharply, you should use the Buy Stop strategy.
However, when using the Buy Stop order, traders should still consider it carefully. At the same time, technical analysis methods must be used to determine appropriate entry points. Don’t forget, to place a Stop Loss order to limit trading risks.
How to place Buy Stop orders effectively for traders
In the previous article, we learned together how to effectively use the when to buy and sell in forex. Today, we will continue to explore how to place a Buy Stop order. Just like other trading orders, to achieve the best results when investing with Buy Stop orders in Forex, investors can apply some of the following strategies:

- Nail-spreading strategy: This is a strategy that is very popular with many traders. Accordingly, you will have to split the order volume when trading. By spreading capital evenly across small investment segments when trading. Although it does not earn much profit, for new traders, this number is not small. Furthermore, if the market price only goes up a little and then goes down, with this strategy, traders will not have to miss trading opportunities.
- Sideway market strategy: In Sideway regions, prices often move sideways and do not fluctuate much. Therefore, this market attracts very little attention from investors. But if the price breaks out of the safe zone and is higher than the resistance level, this is an extremely good profit opportunity with a Buy Stop order. At this time, the trader will place an order slightly above the resistance line. Combined with a Stop Loss order below the resistance and a take profit order above the entry point. Thus, profit maximization can be supported by an increased R: R ratio.
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What is the difference between a Buy Limit and what is Buy stop order?
If you have heard the term what is Buy stop, you have probably also heard of the Buy Limit order. Although these are both types of buy orders, their nature is completely different. The difference between these two types of orders will be clearly shown in the comparison table as follows:
Buy Stop order | Buy Limit Order | |
Nature | Go in the right direction and buy at a higher price | Go the opposite direction and buy at a lower price |
Activate command | When the price rises and breaks through the resistance level | When the price drops and hits the resistance level |
Transaction | With resistance | With support level |
Set command | Set above the current price | Set below the current price |
Depending on the price change trend, investors can choose the correct order entry method to bring the best profit.
summary
Above is information about the Buy Stop pending order type. Hopefully, Learn Forex Trading has helped you understand what is Buy stop and how to place Buy Stop orders effectively. However, to best use these order types, traders should not forget to cultivate more Forex knowledge and experience. Through that, it is possible to make correct judgments about the market.
FAQs:
What financial markets can the Buy Stop order be used for?
The Buy Stop order is not only used in the Forex market but also in other financial markets. Including the stock market, commodities…
What specific price level is needed to trigger a Buy Stop Forex order?
Traders need to determine the resistance level when using the Buy Stop order. So that when the currency price increases and surpasses that price level, the pending order will be activated.
Does a Buy Stop order self-cancel when the currency price does not surpass the resistance level?
If the market price does not surpass the resistance level, the order will not be activated and will be automatically canceled after a certain time.