Become familiar with the crypto market terminology while trading on the XBBIT crypto exchange.
When engaging in trading activities on XBBIT, you participate in the market by executing orders, and currently, there are three distinct order options available for you to choose from.
Non-conditional orders: Market Orders
Conditional orders: Limit Orders, Stop Limit Orders
Market Order
A Market Order is a type of order that is executed instantly based on the best available price.
In the realm of cryptocurrencies, a market sell order will be matched with the most competitive bids listed on the order book, while a market buy order will be matched with the most attractive asking prices.
Market orders are commonly utilized when prioritizing swift execution over obtaining a specific price for the order. When a trader places a market order, they seek immediate execution at the current optimal prices available.
Important: It's crucial to acknowledge that this order type may result in slippage.
Slippage occurs when there is a change in the bid/ask spread between the moment a market order is requested and the time it is executed by the exchange or another market participant.
Limit Order
A Limit Order empowers you to precisely indicate the quantity and price at which you are both capable and willing to engage in buying or selling.
To illustrate, let's assume the most competitive asking price in the market stands at 250, and you desire to purchase at a price lower than 249. In this scenario, you would proceed by placing a limit buy order set at 249. Should a seller be willing to accept your bid - your limit order will be promptly matched and executed at the specified price of 249.
It is noteworthy that this particular order type is recognized as one of the simplest and most transparent methods available.
Stop Limit Order
A Stop-limit Order in the current crypto landscape plays a crucial role in initiating a limit order.
To employ a Stop-limit strategy, a trader sets a stop price that triggers the order and a limit price that determines the execution price. Consequently, once the stop price of a Stop-limit order is reached, it automatically activates the associated limit order.
To illustrate, suppose you wish to purchase a cryptocurrency when its market price reaches 250 but want to avoid paying more than 252. By utilizing a Stop-limit order, you can set a stop price of 250 and a limit price of 252 simultaneously. When the market price hits 250, the order is triggered and matches the best available sell offers up to 252.
Important: Stop-limit orders serve as a valuable tool to mitigate slippage commonly associated with Stop orders in the fast-paced world of cryptocurrencies.
If you have any questions about any of the order types or order options, contact XBBIT Support.
We are happy to support you along the way!