I am learning from School of Pipsology and encountered this part in the lesson “Types of Forex Orders”:
For example, EUR/USD is trading at 1.1000, you have a limit entry order to buy at 1.1009. Your order will not be filled unless you can get filled at 1.1009 or better.
Think of a limit price as a price guarantee. By setting a limit order, you are guaranteed that your order only gets executed at your limit price (or better).
The catch is that the market price may never reach your limit price so your order never executes.
In the previous example, EUR/USD may only fall down to 1.1009 before skyrocketing. So even though you wanted to go long EUR/USD, your order was never executed since you were trying to enter a long position at a cheaper price. You watch EUR/USD rise without you.
I wonder if it’s a typo or there’s something I haven’t known. Why is the limit buy order at 1.1009 when EUR/USD is trading at a lower price at 1.1000? This doesn’t match the definition of limit buy orders I’ve read.
Also, the part “EUR/USD may only fall down to 1.1009 before skyrocketing” makes this even more confusing. EUR/USD is at 1.1000 and falls down to 1.1009? This doesn’t make sense.
I’m glad if there’s a good explanation for this. Please correct me if I’m wrong here. Thanks.