What is the difference between a stop loss and a limit price order in forex trading?

The stop-loss order in forex means that when the price reaches the point that investors expect, the forex market will provide an order to the investor. Investors can choose to continue to invest or use the stop-loss order to lock in their profits. 
 
For many investors who are not familiar with the concept of stop-loss orders, here is the focus of what is meant by stop-loss orders in forex, and the difference between stop-loss orders and limit price orders.
 
There are many reasons for setting a stop loss in forex transactions, but it boils down to the future being unpredictable. Whether it how high the success rate of your trading strategy is, or how good the current fundamental news is for your strategy, the future exchange rate is always unknowable, and every transaction has risks.
 
What does the stop-loss order in forex mean?
 
forex stop loss is a function provided by brokers that can help investors limit losses in market operations that are contrary to trading. This function is mainly achieved by setting the stop loss level, which refers to a certain number of points away from the market entry price.
 
 You can set a stop-loss price whether you are long or short. Setting a stop loss is a very useful strategy in all forex transactions.
 
Traders can solve this problem by looking for a profit target. The target price must be at least as far away as the stop loss. 
 
For example, if a trader's stop loss for a certain position is 50 points, then it is set The minimum target should also be 50 points. Under this strategy, if a trader’s strategy is in the right direction for more than half of the time, then the position is very likely to be profitable. If the position can make a profit of 51%, then it is enough to generate net profit, which is also the main goal of the trader.
 
The difference between stop-loss order and limit price order
 
1. The meaning of stop-loss order and limit price order is different
 
Limit orders refer to the number of funds investors expect to invest, while stop-loss orders refer to the maximum limit that investors can withstand when they lose money. limit price order is a range of investors' investment amount, and stop-loss order is a range of investors' profit and loss.
 
2. The rules of stop-loss order and limit price order are different
 
Short-term operations and long-term operations have different requirements for stop-loss orders. Generally speaking, the range of orders for long-term operations is wider. 
 
The stop-loss order is the limit set after gaining a profit, and the minimum limit is set when a loss occurs, to protect the profit of investors and reduce investment based on the loss of the person. The time of short-term operation is shorter, so the stop loss order range set will be smaller.
 
Importance of stop loss
 
Volatility and unpredictability are the most fundamental characteristics of the market. This is the basis for the existence of the market and the reason for the risks in trading. This is an unchangeable characteristic.
 
There is never certainty in trading. All analysis and prediction are only a possibility. Transactions based on this possibility are naturally uncertain. Uncertain behaviors must have measures to control the expansion of their risks and stop losses. That's how it happened.
 
Other stop loss methods
 
1. Unconditional stop loss
 
Regardless of the cost, a stop loss that flees away is called an unconditional stop loss. 
 
When the fundamentals of the market have undergone a fundamental turning point, investors should abandon any illusions and go out regardless of the cost to preserve their strength and choose the opportunity to fight again. Changes in fundamentals are often difficult to reverse. When the fundamentals deteriorate, investors should act decisively and cut out positions.
 
2. Capital limit stop loss
 
The main point of its operation is to establish the maximum loss limit of the entry position funds or the total funds. Generally, it is 5%-20% of the occupied funds (or 1%-10% of the total funds, etc.); it can also be the absolute amount of the occupied funds, such as $100 per lot. Once the loss limit is reached, immediately stop the loss and leave the market regardless of the price.
 
Regarding the issue of stop-loss orders, this article introduces the meaning of forex stop-loss orders and the difference between stop-loss orders and limit price orders. It can be seen that forex stop loss is a function provided by brokers, which can help investors limit losses, so investors need to pay more attention and use.