Binance offers a variety of buy and sell orders that help traders manage their trades efficiently. Here is an explanation of the most important types of available orders:
1. Market Orders
- Description: Execute the trade immediately at the current market price.
- Features:
- Fast execution.
- Suitable when you want to enter or exit a trade quickly.
- Disadvantages:
- The price may be unpredictable due to rapid fluctuations or low liquidity.
Example:
- You buy 1 BTC at the current market price (like $94,500).
2. Limit Orders
- Description: Execute the trade at a predetermined price or better.
- Features:
- Precise control over entry or exit price.
- Do not pay more or accept less than the specified price.
- Disadvantages:
- The order may not be executed if the market does not reach the specified price.
Example:
- You place a buy order for 1 BTC at $80,000 (it will be executed if the price drops to this level or lower).
3. Stop Orders
A. Stop-Loss Order
- Description: Converts the trade to a market order when a specified price is reached (to protect capital).
- Example:
- You have BTC bought at $94,500, and you place a Stop-Loss at $90,000 (if the price drops to this level, it is sold automatically).
B. Stop-Limit Entry Order
- Description: When a specified price (Stop Price) is reached, a limit order is activated.
- Example:
- Place a Stop order at $90,000 and Limit at $90,300 to buy BTC (if the price rises to $90,000, the purchase is executed at a maximum of $90,300).
4. OCO (One Cancels the Other) Orders
- Description: Combines two orders (Limit + Stop), and if one is executed, the other is automatically canceled.
- Example:
- You have BTC at $90,000, and you place:
- Limit Sell order at $90,500 (to make a profit).
- Stop-Loss order at $88,000 (to protect capital).
- If one is executed, the other is canceled.
5. Time in Force Orders
Specifies the duration for which the order remains active before being canceled:
- GTC (Good Till Canceled) Order: Remains effective until executed or manually canceled.
- IOC (Immediate or Cancel) Order: Executes immediately for the available part, and the rest is canceled.
- FOK (Fill or Kill) Order: Executes fully or is canceled entirely.
6. Post-Only Orders
- Description: The order is placed only as a market maker (Maker), and is not executed as a taker (Taker) to avoid trading fees.
- Condition: The order must not match any pre-existing orders.
7. Conditional Orders
- Description: Activates another order upon meeting a specific condition (such as an index price or a specified time).
- Example:
- "If the price of ETH reaches $3,000, place a sell order for BTC at $100,000."
Important notes:
1. The difference between Maker and Taker:
- Maker:
It adds liquidity (limit order that does not match immediately).
- Taker:
It consumes liquidity (market order or limit order that matches immediately).
2. Fees: Maker orders usually have lower fees than Taker.
How to choose the right order?
- For speed: Market order.
- For precision: Limit order.
- For risk management: Stop-Loss order or OCO.
- For complex strategies: Conditional orders.
Binance also provides advanced orders such as Margin Orders and Futures Orders, which operate on similar principles with the addition of leverage.
