Stop-Limit Orders A stop-limit order is an order to place a regular buy or sell order (also known spil a “limit order”) when the highest bid or lowest ask reaches a specified price, known spil the “zekering.” This can be helpful for protecting profits or minimizing losses.

A stop-limit order is an order to place a regular buy or sell order (also known spil a “limit order”) when the highest bid or lowest ask reaches a specified price, known spil the “zekering.” This can be helpful for protecting profits or minimizing losses.

The stop-limit opbergruimte has three inputs:

  • Zekering – think of this spil the “trigger price.” If you place a stop-limit order to sell, it will turn into a regular limit order when the highest bid drops to or below the zekering. If you place a stop-limit order to buy, it will turn into a regular limit order when the lowest ask raises to or exceeds the zekering.
  • Limit – this is the same thing spil the “Price” on a regular buy or sell order. Merienda your stop-limit order has bot triggered by the highest bid or lowest ask reaching your zekering price, it turns into a buy or sell order for the price you inject ter the limit field.
  • Amount – this is the same spil the “Amount” on a regular buy or sell order. It indicates the amount of coins you wish to buy or sell should your stop-limit order be triggered.

Related movie: QTL – Trading Quatloo on Poloniex – March 25/17


Let’s go overheen some examples.

Selling

Suppose you bought 100 LTC at a price of 0.023 BTC. It’s now at 0.026 BTC. You’ve made some profit, but you’re feeling good about LTC and think it has nowhere to go but up. At the same time, you’re aware that crypto is volatile, and that tomorrow’s headline (“Mt. Gox Loses 750 Million LTC”) could cause the price to crash. How can you hold your LTC, but make sure you get out if a crash comes? Place a stop-limit order with thesis parameters:

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Then click “Sell” ter the stop-limit opbergruimte. A confirmation opbergruimte will come up telling you what will toebijten: “If the highest bid drops to or below 0.024 BTC, an order to sell 100 LTC at a price of 0.023 BTC will be placed.”

You now have some protection. You’re holding your LTC, but if the price crashes to 0.024BTC, your LTC will automatically be sold (spil long spil there are enough buy orders at or above 0.023 BTC). Spil with a regular sell order, your coins will be sold at the best possible price, so, if you want to be sure your coins get sold, set the limit price even lower.

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Your limit price does not have to be lower than your zekering. If you anticipate a dead cat bounce to 0.025 BTC after the crash to 0.024 BTC, you can set your zekering at 0.024 BTC and your limit at 0.025 BTC. This will cause a sell order at 0.025 BTC to be placed should the highest bid druppel to 0.024 BTC.

Buying

Suppose XPM has crashed to 0.002 BTC. It’s low, and it’s a good time to buy those 300 XPM you’ve bot wanting. But you think it isn’t done crashing, and would like to wait for it to go even lower before buying. Still, you could be wrong, and want to be sure you don’t miss out on buying if a whale comes along and pumps the price to the moons of Neptune. Place a stop-limit order with thesis parameters:

Limit: 0.0025 BTC

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Then click “Buy” te the stop-limit opbergruimte. A confirmation opbergruimte will come up telling you what will toebijten: “If the lowest ask rises to or above 0.0022 BTC, an order to buy 300 XPM at a price of 0.0025 BTC will be placed.”

Now, you can see the price plummet spil bagholders wail ter despair. But if you’re wrong and the price skyrockets, you’ll automatically buy ter when the lowest ask reaches 0.0022 BTC (spil long spil there are enough sell orders at or below 0.0025 BTC to voorkant your purchase).

Spil with the sell-type stop-limit order, you can place your limit anywhere you want. If you want to bet on a downtick after the price hits 0.0022 BTC, you can set your zekering at 0.0022 BTC and your limit at 0.0021 BTC. This will cause a buy order at 0.0021 BTC to be placed when the lowest ask reaches 0.0022 BTC.

If this is all too much to recall, just attempt coming in some numbers ter the stop-limit opbergruimte and clicking “Buy” or “Sell.” The confirmation opbergruimte will come up and tell you exactly what will toebijten, and the order won’t actually be placed unless you approve it.

Related movie: QTL – Trading Quatloo on Poloniex – March 25/17


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