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Execution & tools

Stop-limit order

By Jarosław Wasiński • Published: • Updated:
A conditional order that activates a limit order when a specified stop trigger is reached. It separates the trigger price from the acceptable execution price. Reaching the trigger does not guarantee a fill.
Example. In an illustrative sell stop-limit, the stop is 1.1000 and the sell limit is 1.0995. If the market gaps to 1.0980, the triggered limit order cannot sell below 1.0995 and may remain unfilled. This example assumes a venue that permits that trigger/limit arrangement.

Two prices, two jobs

The stop activates the instruction; the limit restricts its price. Permitted placement rules differ between venues and platforms. For example, some retail platforms use stop-limit orders to wait for a retracement after a breakout. Check the exact product rules.

Common mistake

Price protection is not loss protection. If a protective sell limit remains unfilled while the market falls, the original exposure remains. A stop-market accepts uncertain execution price instead; neither order removes every execution risk.

Apply it

Test the order lifecycle on a demo account, including gaps and expiry, and plan what happens if no fill occurs. See MetaTrader 5 order types for platform-specific behavior.

FAQ

Is the stop price the final execution limit?

No. Activation and acceptable execution price are separate fields. Verify their permitted relationship for the venue.

Can a protective stop-limit leave my loss growing?

Yes. An activated limit can remain unfilled while the original exposure remains open.

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Jarosław Wasiński

Editor-in-chief, ForexMechanics.com • Macro & FX analyst

Independent analyst and practitioner with over 20 years of experience in financial markets. Actively involved in Forex since 2007, with a focus on fundamental analysis, OTC market structure, and disciplined capital risk management.

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