A settled (closed) position is a completed trade where you have exited the market. Once closed, you realize your profit or loss and have no further exposure to that currency pair.
How Closing a Position Works
When you close a position, the transaction is finalized and settled. If you're long EUR/USD, closing means selling those euros at the current price. The difference between your entry and exit price is your realized profit or loss.
Open vs. Closed vs. Pending
- Open position: Active trade with live market exposure and unrealized profit or loss.
- Settled (closed) position: Finalized trade with zero market risk and realized profit or loss.
- Pending order: A future trade set to execute automatically under specific price conditions.
Common Closing Mistakes
Emotional timing decisions often hurt traders. Closing too early means leaving money on the table; closing too late means watching profits vanish or losses worsen. Using automated orders—stop-loss and take-profit levels set when entering the trade—removes emotion and ensures consistent execution.
