What is a Stop Limit order?
Stop Limit orders allow participants to set orders that will execute once the price of an asset surpasses a predefined “Stop Price” point.
Stop Limit orders function in a two-part process that can extend peace of mind to one’s crypto adventures.
First, set a trigger point (the Stop Price), which basically pre-orders a trade set at a specific price.
If the price reaches or zooms past that point, the order transforms into a Limit order, ready to buy or sell at the specified price (the Limit Price). This way, traders can wield more control over order execution, even in volatile markets.
The main difference between the Stop Price and Limit Price is that the first value opens the order, but doesn’t execute a trading transaction.
For a buy order, the limit price is typically set above the stop price; whereas a sell order is usually set below the stop price.
Let's imagine that the current ETH price is $2,000, and a trader anticipates that it will soon rise to $2,500.
However, this trader only wants to buy ETH valued at $2,000 and would prefer to not pay more than $2,100 in case the price rises too quickly. This is where a Stop Limit order comes in handy.
The trader can set the Stop Price at $2,000, and the Limit Price at $2,100. If the price reaches the Stop Price, the Stop Limit order automatically becomes a Limit order. This limit order will be executed if the market price reaches $2100, but not higher.
How to place a Stop Limit order
1. Open the Trade page
2. Choose a pair
The trading pair selector allows participants to browse available markets by either scrolling or using the search bar.
By default, either BTC-USD or the last selected pair is pre-selected.
3. Select an account (a Wallet or sub-account)
4. Set the order direction (Buy or Sell)
5. Switch the order type to Stop Limit
6. Set the Stop price
The Stop price will trigger a Limit order once the market reaches the predetermined value.
7. Define the Limit price
This is the price at which the transaction (Limit Order) will execute.
For buy Stop-Limit orders, the Limit Price establishes a ceiling, or maximum acceptable price to buy the asset. In other words, the order will only be executed if the market price reaches, or falls below, the specified Limit Price.
For sell Stop-Limit orders, the Limit Price conversely represents the minimum acceptable price to sell the asset. The order will only be executed if the market price reaches, or rises above, the specified Limit Price.
The Limit Price is always listed in the second (quote) currency of a trading pair (e.g. the price for BTC-USD appears in USD).
8. Enter the amount of crypto to buy or sell
The order amount is set in the first, or base currency, of the pair, which is usually a crypto.
Please keep in mind that minimum and maximum order amounts vary for each trading pair. More information outlining these parameters can be found in the Trading Conditions section of the Profile menu.
Make sure to verify all order details before confirming placement:
Total — The approximate amount to be charged as a result of Limit Order fulfillment.
Fee — The amount owed to the network and platform to fulfill the order.
9. Confirm order placement
Once all the parameters are set, confirm the new order placement by clicking on the Place Buy Order (Place Sell Order).
A pop-up window with a brief overview of the order should appear. Check the order details. If satisfied, click the Confirm button.
Another pop-up window confirming order’s placement should appear next.
Please note that all current order status and related information can be found in the Orders details section on the Trade page.
By their nature, Stop Limit orders can give traders more control over the purchase/sale price, but cannot guarantee order execution if the Stop Price or Limit Price is not reached.
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