In other words, order types are plans that you can trade. Orders allow you to plan your currency purchases and sells without needing to follow the market. You can program Bitcoins to be sold at a specific price.
1. Market Order
Market orders can be placed immediately and executed based on the current currency value. The system will use the price that a user has chosen to purchase or sell coins.
In other words , you must specify the quantity that was purchased, but not the amount that will be paid. This is the current market price.
2. Limit Order
Limit orders allow the user to specify the price and quantity they wish trade. Your order to buy or sell currency will be completed when the exchange rate is at the set amount. If the market value is greater than what you have set at the time you placed your order, the system will trade automatically.
It works like this:
You can place a Limit order for R $30 to purchase Bitcoin when it reaches R30 if it is worth R $40. If Bitcoin’s price falls below R$ 40 or R$ 30, the system will execute your order. The order has not been executed but remains in the Order Book, awaiting market movements.
3. Stop ordering
Both the Limit order and Stop order are similar. The Limit order considers the exact price you want to sell or purchase. However, the Stop takes into account price transition so long as it does not exceed a certain amount. The Stop will execute the order at the market price if the Stop price exceeds.
This is an example of the difference between Limit or Stop.
- Let’s say that Bitcoin is worth $40
- You have placed a Limit order for $35.50. This amount will be added to the Order Book. To make it more affordable for everyone, you can lower the price.
- You have already placed an online order. You cannot place another order. The Order Book will be emptied of R 35.50. Your order will be executed at market rate and the price will be reduced to R$35.50. The next amount will be charged at R$35.50 after downloading.
Let’s try to explain it another way.
Stop for sale: This can be used to manage your losses. If a coin’s price falls below a specific value, you will need to sell it. Simply enter the trigger amount. The current currency exchange rate must not be exceeded by this price. Your coins will be immediately sold if the market reaches that price.
Buy-Stop : This allows you the option to purchase these currencies only if they increase in price. Enter the amount and the price. This price must not be lower than the current currency exchange rate. Your coins will be purchased immediately if the market reaches that price.