Buy Stop Order Definition

A buy stop order is an instruction to buy an asset once its price rises to a specified level above the current market price.

What is a Buy Stop Order?

Buy stop orders are often used to enter a position on a breakout above resistance, or to limit losses on a short position.

Once triggered, the order is typically executed as a market order at the next available price.

A trader places a buy stop at $55 for a stock trading at $52, so the order triggers if price rises to $55.

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