What is Take Profit?

What is Take Profit

Take profit (T/P) order is a type of order which allows the traders to save a limited amount of profit in case the market behaves unexpectedly. Many short term traders use this order to make a set amount of profit which they determined for a day or per trade. When you place a take profit order you decide a particular limit at a higher price for a currency you bought, which you believe the market will hit and your order will automatically close once reaching that limit leaving you with your profit. Now a downside to this type of order is that even if the market price had continued to rise providing more room for profit, you would have missed that because your order was already closed. However, this is beneficial for those traders who believe any profit is better than having no profit.

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