Orders on cryptocurrency exchanges; it is an instruction used to buy and sell. In addition, whether you create a buy order or a sell order on cryptocurrency exchanges, the most important element of everything is to determine your primary goal. Then you can use the order types to reach your goal in line with the goal you set. In our article, you can find instant trading market (taker) order, limit (maker) order or stop-limit order explanations where you can trade at your preferred price as order types.
Now let’s examine the most commonly used order types on cryptocurrency exchanges:
What is Market Order and How to Use It?
It is the order used to trade instantly at the most advantageous prices between buy and sell orders in the trading pair you choose on the crypto money exchange. With a market order, you can instantly buy or sell. If you want to sell your cryptocurrency, you will meet the highest purchase offer given instantly with your order. When you want to buy, you will buy instantly from the person who sells at the lowest price. With the market order, the instant buying or selling process is provided between the buy and sell orders. After selecting your portfolio percentage to execute your trade, your order is executed when you say buy or sell.
What is a Limit Order and How to Use It?
A limit order is a type of order placed to buy or sell at a specific price on your chosen cryptocurrency trading pair. For example, if the instant market price is not available for buying, you can enter a limit order to buy when the price drops to a level you prefer. Likewise, you can enter a limit order at a price of your choice to sell when the price rises. When entering orders, you need to enter the price at which you want the cryptocurrency to be bought or sold, and select your portfolio percentage and confirm the transaction; Your order is added to the list of buy and sell orders. Then, another trader who wants to cover your trade at the price you entered in the stock market is expected to enter an order.
What is a Stop-limit Order and How to Use It?
The best way to understand a stop-limit order is to first divide it into definition, stop price and limit price. The stop price is simply the price that triggers your order. Your order will be triggered when a trade passes at this price on the exchange. The stop-limit order you entered will not be executed unless the trade is executed at this price. The limit price is the price at which you agree to trade. The order you enter when you use a stop-limit order for a buy trade is referred to as a stop-loss when you enter it for a take-profit or a sell-off trade. For example, let’s say that if a cryptocurrency breaks a critical resistance price upwards, the price will rise further, but there can be no rise unless it can break it. In this case, you set the critical resistance level for you as the stop price. If this price is above an amount you prefer, you should write it as the limit price.
When you rise to your market stop price and trade at your stop price on the stock exchange, your order will be triggered and activated and your buy will be made in the stop price and limit price range you entered. In this case, you will have the opportunity to take your profit from the increase in price. On the contrary, you think that if a support level that you consider critical for a crypto money in your portfolio is broken downwards, the decline in price will continue. In this case, you want to enter a stop-limit order to avoid losses. The critical support level you set will be the stop price for you. If a price below this price is an amount you prefer, you should write it as the limit price. When you fall to your market stop price and trade at your stop price on the stock exchange, your order will be triggered and activated and your sale will be made within the stop price and limit price range you entered. In this case, you will be minimally affected by the decline in the market and you will keep your losses at a minimum level.
