#OrderTypes101 In crypto trading (just like in traditional trading), order types define how you want to buy or sell an asset. Here's a breakdown of the most common order types:
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š¹ 1. Market Order
Definition: Buys or sells immediately at the best available price.
Use Case: When speed is more important than price.
Example: You want to buy Bitcoin right nowāyou place a market order, and it fills at the current market price.
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š¹ 2. Limit Order
Definition: Buys or sells only at a specified price (or better).
Use Case: When you want to control the price you're paying or receiving.
Example: BTC is $65,000 but you only want to buy it at $63,000. You set a buy limit order at $63,000.
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š¹ 3. Stop Order / Stop-Loss Order
Definition: Triggers a market order when a specific price (stop price) is hit.
Use Case: To limit losses or protect profits.
Example: You bought BTC at $60,000 and want to limit loss. You set a stop-loss at $58,000. If the price drops to $58,000, it auto-sells.
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š¹ 4. Stop-Limit Order
Definition: A combination of a stop order and a limit order. When the stop price is hit, a limit order is placed.
Use Case: More control than a simple stop-loss.
Example: You set a stop at $58,000 and a limit at $57,800. If BTC hits $58,000, it places a limit sell at $57,800.
