Understand how each order type works before risking real money
Execute immediately at the best available price
A market order fills instantly at whatever price is available. You get guaranteed execution but NOT a guaranteed price. In fast markets, you may get filled at a worse price than expected (slippage).
When you MUST get in or out NOW — closing a losing trade, entering during a breakout you can't miss, or when the spread is tight and the market is liquid.
Slippage in fast/illiquid markets. You might pay 2-5 ticks more than expected during high volatility. Always check the spread before sending.
NQ is breaking out above resistance at 18,500. You send a market buy. The best ask is 18,502. You get filled at 18,502 — 2 ticks of slippage, but you caught the move.
| Feature | Market | Limit | Stop | Stop-Limit |
|---|---|---|---|---|
| Execution guaranteed? | Yes | No | Yes* | No |
| Price guaranteed? | No | Yes | No | Yes |
| Slippage risk | High | None | High | None |
| Best for | Exits | Entries | Stop loss | Volatile mkts |
| Common use | Emergency exit | OB/FVG entry | Protective stop | Controlled stop |
Using the wrong order type can cost you money on every single trade. A market order during low liquidity might cost 3-5 ticks of slippage. A limit order at the wrong level means missed entries. Understanding order types is as fundamental as understanding candlesticks.