#OrderTypes101

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When trading cryptocurrencies on an exchange, you need to place orders to buy or sell. These orders tell the exchange what you want to do and under what conditions. Here's a breakdown of the most common order types:

1. Market Order

What it is: Buy or sell immediately at the current market price.

Use when: You want to execute quickly and don’t mind a little price slippage.

Pros: Fast execution.

Cons: You may get a worse price during volatility.

> 🔹 Example: “Buy 1 BTC right now” — it will be filled at the best available price.

2. Limit Order

What it is: Buy or sell at a specific price or better.

Use when: You want price control and don’t need immediate execution.

Pros: More predictable pricing.

> 🔹 Example: “Sell 1 BTC at $70,000” — only fills if price hits $70K or higher.

3. Stop Order (aka Stop-Loss)

What it is: An order that activates a market or limit order once a specific price is hit.

Use when: You want to limit losses or lock in profits.

Types:

Stop Market: Turns into a market order when triggered.

Stop Limit: Turns into a limit order when triggered.

> 🔹 Example: “Sell BTC if it drops to $60,000” to prevent bigger losses.

4. Take-Profit Order

What it is: Like a stop order, but aimed at locking in profits.

Often used with stop-loss to automate both ends of a trade.

> 🔹 Example: “Sell BTC at $75,000 to take profits if the price pumps.”

5. OCO Order (One Cancels the Other)

What it is: A combo of a limit and a stop order. When one executes, the other is canceled.

Use when: You want to set both a take-profit and stop-loss at once.

> 🔹 Example: Set a limit sell at $75K and stop at $60K — only one will trigger.

6. Trailing Stop Order

What it is: A dynamic stop-loss that follows the price as it moves in your favor.

Use when: You want to let profits run but protect against reversals.

> 🔹 Example: Sell if BTC falls 5% from its highest price since you entered.