Take Profit/Stop Loss Orders

Take Profit (TP) orders are utilized to automatically close a position and secure profits once the market price hits a predetermined level:

• Long Positions: above the entry price

• Short Positions: below the entry price

Conversely, Stop Loss (SL) orders are employed to automatically close a position and limit losses once the market price reaches a preset level:

• Long Positions: below the entry price

• Short Positions: above the entry price

How should the TP/SL orders be set?

	TP	SL
Long Positions	Place it at a price level higher than the entry price where you intend to close the trade and secure profits	Place it at a price level Lower than the entry price to close the trade and prevent additional losses, and Higher than the liquidation price to prevent liquidation rather than simply closing the position.
Short Positions	Place it at a price level lower than the entry price where you intend to close the trade and secure profits	Place it at a price level Higher than the entry price to close the trade and prevent additional losses, and Lower than the liquidation price to prevent liquidation rather than simply closing the position.