Millisecond is counted in the proposal of trading, and accuracy is a necessity. Choosing the appropriate order type is an important option that often determines your success – or failure. The border and stop orders are two most powerful, but the sequence types pending in MetaTrader 5 (MT5) are misunderstood. This guide will help you if you are giving orders that either never trigger or are triggered at the wrong time, or if you are uncertain when you buy the purchase range instead of a stop.
We will go over the major distinctions between the border and the stop order, how they are related to other types of orders in MT5, and how to use them as a prop firm trader.
Why Understanding Limit vs. Stop Orders Matters in Prop Trading
Prop firms demand strategy, stability, and effective execution. The order type you have chosen has a direct impact on your performance, whether you are trading with a 1:100 leverage account or controlling the risk with a firm-set drawdown boundaries.
Can choose between a stop order and a boundary order: you can find out if you are filled at a favorable price. Help you enter strategic pullbacks or breakouts. Make sure you follow the guidelines of the trading plan for your prop firm.
- Spread the slippage to minimize, especially when volatility is higher.
- Knowing when and why to use these orders, if you are serious about day trading in a prop firm, is important as your entry signal.
Overview of Pending Orders in MT5
Four main pending orders are divided into two types of orders in MT5:
Limit Orders
Purchase limit: Purchase at a discount at the rate of leaving.
Sell border: Sell for more than the rate of leaving.
Stop order
Purchase Stop: Purchase at a higher price than the rate of leaving.
Sell stop: Sell below the Going Rate. Although they are all classified as the MT5 order type, each has a separate trading function.
What Is a Limit Order?
You can enter the market at a low price which is currently presented by ordering a limit. In short, you are saying: “I want to enter, but only when the price reaches this particular level.”
🟢 Use the case for props trading:
Suppose you are trading a Eur/USD pullback. The market is currently at 1.1020, but the support area of 1.1000 is the place where you should buy. At 1.1000, you set a purchase limit. If the value takes a dip there, the order executes – gives you a better entry.
✅ Pros:
- Improved price entry
- Helps prevent many payments or selling very soon.
⚠️ Cons:
- There is no assurance that it will fill.
- If the price does not return to the level, no one can miss a step.
What Is a Stop Order?
When the market reaches a particular level, a stop order enables you to enter with speed. It is then employed when you want to confirm before entering that the price is moving in a specific direction.
🔴 Use Case in Prop Trading:
Suppose you are estimating a breakout above 1.1050. 1.1020 is the current value. At 1.1051, you set a purchase stop. Once the order reaches the price or crosses that level, the order becomes active, so that you can benefit from the breakout.
✅ Pros:
- Confirmation of speed
- Perfect for the following or breakout strategy
- You do not need to sit and monitor the chart.
⚠️ Cons:
- Slippage can be an issue in markets that move quickly.
- The cost of entry may be reduced.
How to Place Limit and Stop Orders in MT5
- Right-click on F9 or the chart to open a new order window in MT5. Under the “order type”, select the pending order.
- Choose the type you like best: Buy boundary/sell border
- Purchase stop/sale stop. Input your entry price, volume, and, if you want, input your level benefits and stop-loss.
- Press the place. When the value you have specified is hit, the business is automatically started.
Prop Firm Tips: Limit and Stop Orders in Action
- First, Risk Management. A stop loss should always be attached to any pending order. This requires funding and the evaluation rules of many prop firms.
- Use a price alert. Use an MT5 alert at major levels to evaluate before admission. If you are not sure whether or not it is committed to a pending order.
- Test your entry argument again. Determine whether your setup works better with pullback entries (boundary) or speed confirmation (stop) when using a prop firm day trading strategy.
- Clear to chase the border. If the market is trending quickly, do not keep your range orders upwards to “catch”. Most prop firms will be flagged as emotional trade.
Final Thoughts
If you talk about MT5 order types, you have more strategic flexibility if you understand the difference between the border and the stop order. You should maintain your composure, discipline, and efficiency as a prop firm day trader, and select the appropriate order type AIDS to achieve all three objectives. You can get a better price on retracement with limit orders. When it comes to a breakout, stop the orders. Give you confidence. If you can master both, you will have a significant benefit in any market.
Pro Tip: One-click trading with integrated SL/TP is possible on many best prop firm MT5 platforms. To cut execution errors and save time, set a predetermined template for the boundary and stop order.
