2.   Shading the Offer
The market maker can also increase the possibility of being long in Australian dollars by adjusting the offer price. In this case, the market maker wants to offer the base currency, AUD, at a higher price than other market makers, so that few if any price takers will buy AUD from it.
The market maker makes their offer at AUD/JPY 95.5915 which is comparatively expensive, since the market would be cheaper at AUD/JPY 95.5706. This too is called shading the price. It means that while traders may sell the Australian dollar at the market rate, no-one is going to purchase AUD from the market maker when they can purchase it cheaper in the market. This therefore increases the chances of the trader being long in Australian dollars.

Stop-Loss Orders

Banks place daylight trading limits and revaluation limits on their traders in order to manage the risk of foreign exchange rate movements on the positions of individual traders within a financial institution. The bank controls this area of their business by applying and monitoring these limits. A trader who deliberately or carelessly exceeds these limits will be subject to severe disciplinary action which could include termination of their employment.
Dealers who have an open position might set a level where, if the market is moving against them, they can close their position and cut their losses. Typically, a stop-loss order is left by a customer with the corporate dealer to look after during the trading day or overnight, or is left by a spot dealer with his counterpart in another financial center overnight, that is, when that dealer’s market is closed.

Stop-Loss Orders: Example

Let's look at how an FX trader might implement a stop-loss order on an AUD/JPY trade.
Currently, it has a long AUD against JPY at an average rate of 95.5345. It wants the AUD to strengthen so that it may close its position with a profit. However, it might decide to set a stop-loss order at the (slightly lower) level of 95.4950 to protect it against the AUD weakening against JPY. In other words, the market maker is prepared to cut its losses when the market reaches the level of 95.4950.