A bracket order is a combination of a stop order and a limit order. It is used to protect an open position. You can instruct the platform to automatically place a bracket order after you have opened a position. The platform will place a limit order on the objective and a stop order at the maximum loss you are willing to incur. These orders are linked. When one is executed the other is automatically cancelled.

Note: You can not only use price levels to set your bracket orders. You can also use percentages (e.g. a price objective of 1%) or the ATR (Average True Range). Many professionals use the ATR.

This the most classic example of a bracket order: a long position with a limit sell (green) at the objective and a sell stop (red) at the maximum loss. The platform, however, offers numerous other possibilities such as a time stop, a break even stop, a trailing stop, a trend line stop, ...