Metatrader 4 is the leading platform for forex trading. Although the latest version of the software, Metatrader 5, has been available since 2010, the majority of users still use its predecessor due to the fact that more brokers support this version, and there is a much bigger library of third-party add-ons available for it. Generally speaking, it is a good idea to download the version that is supplied by your broker, as it will contain the server settings for that broker, which will shorten the length of time that it takes to set up.
Placing an Order
There are two types of order that you can place in Metatrader: Instant Execution Orders, and Pending Orders. Instant Execution Orders are orders that are executed when you press the Sell or Buy button, and Pending Orders are orders that will only be executed when certain conditions are met. You can place both types of order from within the Order menu, which can be brought up in a number of ways. Perhaps the easiest method is to double-click on the pair you would like to trade in the Market Watch window. The order window contains a graph of the historical bid and ask prices for that pair, a numerical readout of the current prices, and dialog boxes that allow you to set the lot amount and place stop loss and take profit orders.
When the window first opens, it will be set up to place an Instant Execution order. If you wish to place a pending order, you have to select this option from the Order Type dialog box. This brings up a number of extra parameters that you can alter for the order. There are four main types of pending order: Buy Limit, Buy Stop, Sell Limit, and Sell Stop.
A Buy Limit is an order to buy a currency when it falls below the current price, and this can be used to get into the market at a lower price than the current price. A Buy Stop is an order to buy a currency when it goes above the current price, and this can be used to enter the market when a certain price level is reached. This type of order is commonly used on breakout trades. A Sell Limit is an order to sell when the currency rises above the current market price, and this allows you to get in short when the price moves higher. Finally, a sell stop is an order to sell below the current market price, and this can be used to enter short when the price falls below a specific level. As well as being able to set the type of pending order, you can also set the price at which you want the trade to be triggered, and the expiry length of the order, which tells MT4 to cancel the order after a certain length of time. You can disable the expiry function, in which case the order will remain active indefinitely until the conditions of the order are met.
An important thing to bear in mind is that there is sometimes a time delay between placing the order and the order being executed, which means that the price that you see when you make the trade may not necessarily be the price that the trade is executed at. This can be particularly pronounced during periods of extreme volatility, and the amount of time lag can vary from broker to broker, and can depend on the amount of trading activity on the server, the performance of your computer, and the quality of your web connection.