Take profit: meaning in forex and gold trading
A take profit is a limit order that closes a trade automatically when price reaches a chosen profit target.
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Take profit: A take profit is a limit order that closes a trade automatically when price reaches a chosen profit target.
How take profit works
A take profit (TP) sits above the entry on a buy and below it on a sell. When price touches it, the position is closed at that price or better. Many signal services, including Forexuro, publish several targets so a trader can close part of the position at each level, sometimes called a take profit ladder.
Choosing targets
Targets usually come from nearby support and resistance, prior swing points, pivot points or a fixed risk to reward ratio. The target and the stop together determine what win rate you need to break even.
Worked example
Short EUR/USD at 1.1240, stop at 1.1270 (30 pips), TP1 at 1.1210 (30 pips, 1:1), TP2 at 1.1180 (60 pips, 1:2). Closing half at TP1 and moving the stop to breakeven is one common way to manage it.
Common mistakes
- Setting targets with no reference to market structure.
- Cutting winners early while letting losers run.
If you follow trade signals, for example the gold signals or EUR/USD signals, understanding this term helps you size and manage each trade yourself. The free Forexuro Telegram channel shares daily market updates where these ideas are used in practice.
Related terms
Tools and guides
Frequently asked questions
Is a take profit guaranteed?
It is a limit order, so it fills at your price or better if price reaches it, but price may stop short.
Why do signals have several TPs?
To let traders lock in part of the profit and manage the rest.
Education only, not financial advice. Trading forex, gold and CFDs carries a high risk of losing money, and leverage magnifies both gains and losses. Past performance is not a reliable guide to future results. Read our risk disclosure.