Above the Market

 

Definition: Refers to an order that is placed at a higher price than the market is currently trading at. It can be a limit order to sell, a stop loss or a stop entry to buy.

 

 

Additional Info: Momentum traders often use this method as do traders who use open positions around major data releases. They will place a buy stop above strong resistance to participate in the breakout. It is possible to experience slippage on these orders if the market breaks rapidly enough.
It is not uncommon for program traders to place 'above the market' orders if they decide not to spend their entire day sitting in front of their computer screen watching price fluctuation. These orders are placed on a ‘set and forget’ basis.

Related Terms: Slippage - Below the Market - Limit Order - Stop Loss - Stop Entry

 

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