Limit Order
- A Limit Order allows you to set a specific price at which you want to buy or sell.
The trade will only be executed when the market reaches your specified price or better.
- This type of order is used when you do not want the trade to execute immediately and prefer to buy at a lower price or sell at a higher price than the current market rate.
Example:
BTC is currently at $60,000. You want to buy when the price drops to $59,000 → Place a Limit Buy order at $59,000.
You are holding BTC and want to sell when the price reaches $62,000 → Place a Limit Sell order at $62,000.
⚠️ Note:
- The order may not be filled immediately.
- The order will remain on the Order Book until the market price reaches your specified level.
Market Order
- A Market Order executes immediately at the best available price on the market.
- It is used when you need a quick execution and are not concerned about the exact price.
Example:
You want to sell BTC immediately because the market is dropping sharply → Use a Market Order to sell quickly.
⚠️ Note:
- You cannot control the execution price — the price may slip if the market is moving fast (this is called slippage).
- Typically used in urgent situations or for small trade amounts.
Stop-Limit Order
- A Stop-Limit Order combines a Stop (trigger) price and a Limit (target) price. When the market price reaches the Stop level, the system will automatically place a Limit order to buy or sell.
- It is commonly used to protect profits or automatically cut losses.
You need to set two prices:
- Stop Price (trigger price)
- Limit Price (price of the Limit order once triggered)
🔽 Example – Stop Loss:
BTC is currently at $60,000. You want to cut losses if the price drops to $58,000:
- Stop = 58,000
- Limit = 57,800
→ When the price hits $58,000, a sell Limit order at $57,800 is placed on the order book.
🔼 Example – Take Profit:
BTC is currently at $60,000. You want to take profit if the price rises to $65,000:
- Stop = 65,000
- Limit = 65,200
→ When the price hits $65,000, a sell Limit order at $65,200 is triggered.
⚠️ Note:
- If the market price moves too fast and skips the Limit price, the order may not be filled.
- Set the Stop Price close to the Limit Price to increase the likelihood of execution.