What is an order?
An order is your command to the exchange. You say what to buy or sell, how much, and at what price. The exchange executes it. There are three main order types — each has a different purpose.
Know which order to use and when
An order is your command to the exchange. You say what to buy or sell, how much, and at what price. The exchange executes it. There are three main order types — each has a different purpose.
A market order executes immediately at the best available price. You get filled right away, but you do not control the exact price. Good when you need to act now — entering or exiting fast. The downside is that in volatile markets, the price you get can be slightly worse than what you see on screen. This is called slippage.
A limit order lets you set a specific price. The exchange waits until the market reaches that price, then executes your order. Cheaper fees than market orders. But there is a risk — if the price never reaches your level, the order stays open and never fills. Good for patient traders who are not in a hurry.
A stop order triggers automatically when price hits a specific level you set. It is most commonly used as a stop-loss — to limit your losses. Example: You bought BTC at $100,000. You set a stop at $95,000. If price drops to $95,000, the order fires automatically and closes your position. You lose $5,000 instead of potentially much more.
The choice depends on your situation: Urgent entry or exit — use a market order. Speed matters more than price. Specific price target — use a limit order. You are willing to wait. Protecting an open position — use a stop order. Set it and forget it.
You want to buy BTC, but only if it drops to $90,000. Which order type should you use?
An order is your command to the exchange. You say what to buy or sell, how much, and at what price. The exchange executes it. There are three main order types — each has a different purpose.