On Binance, there are several types of orders you can use to buy or sell cryptocurrencies. Here's a breakdown of the main order types:
🔹 1. Market Order
What it does: Executes immediately at the current market price.
Use case: When speed is more important than price precision.
Risk: You might get a worse price due to slippage, especially in volatile or illiquid markets.
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🔹 2. Limit Order
What it does: Executes only at a specific price (or better).
Use case: When you want to buy/sell at a specific price and are willing to wait.
Note: It may never execute if the market doesn't reach your price.
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🔹 3. Stop-Limit Order
What it does: Becomes a limit order once a stop price is reached.
Components:
Stop Price: Triggers the limit order.
Limit Price: The actual price of the limit order placed once the stop is triggered.
Use case: Risk management, e.g., selling a coin if it drops to a certain level.
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🔹 4. Stop Market Order
What it does: Becomes a market order when the stop price is reached.
Use case: Quicker execution than stop-limit, but no price guarantee.
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🔹 5. Take-Profit Limit Order
What it does: Similar to a stop-limit, but intended for locking in gains.
Use case: Selling at a target price once a trigger level is hit.
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🔹 6. Take-Profit Market Order
What it does: Triggers a market order once the take-profit price is hit.
Use case: Ensures you exit a position fast after reaching a profit target.
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🔹 7. Trailing Stop Order
What it does: Moves with the market price and executes a market order if the price reverses by a specified percentage.
Use case: Locks in profits while allowing the position to continue benefiting from favorable price moves.
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🔹 8. OCO (One Cancels the Other) Order
What it does: Combines a stop-limit and a limit order. When one executes, the other is canceled.
Use case: You can set a profit target and a stop-loss simultaneously.