1. Limit Order:
A limit order is an order where the trader specifies a particular price, and the order is only executed when the market price reaches or is better than the specified price. Traders can control the trading price through limit orders to ensure buying or selling cryptocurrencies at their desired prices.
- Advantages:Limit orders allow traders to precisely control the trading price, avoiding transactions at unfavorable prices due to market fluctuations. Especially during high market volatility, limit orders help traders avoid buying at inflated prices or panic-selling at low prices.
- Disadvantages:Since limit orders are only executed when the market price reaches the specified price, the order may not be filled if the market price does not touch the specified level.
Example:
Buy Limit Order: The current Bitcoin price is $80,000, and you consider $75,000 an ideal buying price. You can place a buy limit order at $75,000. When the market price drops to $75,000 or lower, your buy limit order will be executed, allowing you to buy Bitcoin at no higher than $75,000.
2. Market Order:
A market order is a buy or sell order executed immediately at the current market’s best available price. When you place a market order, the system automatically matches your order with existing counterparty orders at the fastest speed and completes the transaction at the best obtainable price.
- Advantages:Fast execution ensures transactions are completed in minimal time, making it ideal for traders looking to enter or exit the market quickly—for example, seizing fleeting price opportunities during rapid market changes.
- Disadvantages:Price uncertainty: While market orders execute quickly, the trade price is not guaranteed. As the market price fluctuates, the actual execution price may differ slightly from the price seen at the time of order placement.
Example:
Buy Market Order: Suppose the current Bitcoin ask price (sell order) is $80,000, and the bid price (buy order) is $79,999. Placing a market buy order for Bitcoin will immediately match with the ask price, executing the trade at $80,000. Conversely, a market sell order will match with the bid price, selling at $79,999.
3. Scheduled Order
Setting and Trigger Rules
|
Long
|
Direction | type | Trigger Price Setting | Trigger Scenario |
|---|---|---|---|---|
| Long | Open Long |
Bulls
|
Trigger Price > Last Price | Market Price ≥ Trigger Price |
| Long |
Rebound
|
Trigger Price < Last Price | Market Price ≤ Trigger Price | |
| Long | Open Short |
Bears
|
Trigger Price < Last Price | Market Price ≤ Trigger Price |
| Long |
Rebound
|
Trigger Price > Last Price | Market Price ≥ Trigger Price |
Example:
Take this chart as an example. When going long, if the latest market transaction price is higher than the trigger price, it is assumed that the price may fall and then rebound in the future. When the latest transaction price during the rebound reaches the trigger price, an order will be placed at the designated order price in the contract market for matching and execution. To increase the probability of execution, the order price can be set to the market price. If the latest market transaction price is lower than the trigger price, it is assumed that the price may continue to rise in the future. When the latest market transaction price reaches the trigger price, an order will be placed at the designated order price in the market for matching and execution.
Note:
Positions and margin will not be frozen until a scheduled order is successfully triggered. A scheduled order may not necessarily be triggered and executed successfully. Order failures may occur due to factors such as extreme market volatility, price limits, position limits, insufficient assets, system issues, or the contract being in a non-trading state. Once a scheduled order is successfully triggered, it becomes a regular limit/market order, which may not necessarily be executed. Unfilled limit/market orders will appear in the current limit/market order records.
4. Take Profit & Stop Loss Orders
Take profit and stop loss orders are two common risk management tools used to help traders control risks and lock in profits. However, due to factors such as price limits, insufficient market depth, high slippage, or setting limit orders after the trigger, it cannot be guaranteed that orders will be executed 100% or that profits will be fully locked in.
Setting and Trigger Rules
| Close | Direction | TP/SL | Trigger Price Setting | Trigger Scenario |
|---|---|---|---|---|
| Close | Close Long |
TP | Trigger Price > Last Price | Market Price ≥ Trigger Price |
| Close | SL | Trigger Price < Last Price | Market Price ≤ Trigger Price | |
| Close | Close Short |
TP | Trigger Price < Last Price | Market Price ≤ Trigger Price |
| Close | SL | Trigger Price > Last Price | Market Price ≥ Trigger Price |
Take Profit Order
- Meaning: A take profit order refers to a specific price level set by a trader during cryptocurrency trading. When the market price reaches or exceeds this level, the system automatically executes a sell order to realize profits and lock in gains.
- Function: Its primary role is to help traders exit positions at a pre-determined target price when market conditions are favorable, avoiding the risk of profit shrinkage or even losses due to market reversals. By setting take profit orders, traders can plan their strategies based on their risk tolerance and profit expectations, ensuring that investment goals are achieved to a certain extent.
Stop Loss Order
- Meaning: A stop loss order is a price set by a trader, at which or below which the system automatically triggers a sell order when the market price of a cryptocurrency drops, limiting further loss expansion.
- Function: It serves as a risk control mechanism to prevent losses from exceeding a trader’s tolerance when market trends are unfavorable. Stop loss orders help traders exit positions in a timely manner amid market uncertainty and volatility, protecting remaining capital and avoiding severe damage to their accounts due to excessive losses.
Example:
A trader buys a cryptocurrency at $80,000 and sets a take profit trigger price at $85,000 and a stop loss trigger price at $75,000. If the market price rises to $85,000, the take profit order is triggered, and the system sells the asset at the pre-set limit price or market order to lock in profits. If the market price falls to $75,000, the stop loss order is activated, and the system sells at the set limit or market price to minimize losses. Typically, when market depth is sufficient, using market orders for take profit/stop loss triggers ensures quick execution at market prices.