A Take Profit is an order placed to automatically close an open position once a specified profit level is reached. When the market price reaches the predefined level, the position is closed at the next available market price.
Take Profit orders allow traders to secure gains without having to manually close positions.
Example:
You buy Gold (XAU/USD) at 4000 and set a Take Profit at 4020.
If the market rises to 4020, your trade will automatically close, locking in the profit.
Why Use a Take Profit?
Locks in profits automatically
Helps maintain trading discipline
Avoids giving back gains due to market reversals
Supports structured trading plans