What is a Limit Order?
A limit order is a form of order in which you specify a price limit or set of conditions for buying and selling bitcoins. If you set a limit on your purchase orders, for example, the order will be executed only at the limit price you specified or even lower, whereas limits on sell orders would be executed starting at the limit price or even higher than the one you set. Traders can better manage the prices they trade by setting these preconditions.
How does it work?
A limit order instructs a trader to purchase a sttock at or below a certain price or to sell a stock at or above the specified price. A limit order basically tells that you want to buy or sell a stock, but only if the price reaches your intended target. With these instructions, a trader will only execute a trade if the order achieves the limit price or greater. Limit orders are used by investors when they are concerned about a stock’s price changing dramatically or when they are not interested in executing a trade right immediately.
There are two types of Orders
Buy Limit Order :
Buy Limit order is an Order to purchase a stock for a desired price. The Order will be implemented if the price of the stock meets the targeted Price or lower price.
Sell Limit Order :
Traders can set a Pin to sell your order to attain the desired stock price. The order will be closed when your stock meets the targeted price or is lower than the targeted price.
Benefits of Limit order:
The most appealing aspect of a Limit Order is that it allows the trader to execute a trade only when the price is favorable to them. The trader can choose the rate for when they want to buy or sell the cryptocurrency ahead of time. Limit Orders also provide the following advantages:
- Traders are in charge of determining when it is appropriate to buy or sell cryptocurrency.
- Even if the cryptocurrency has not yet reached the target, the amount can be specified.
- When trading at greater volumes, this is advantageous.
- One might avoid checking crypto prices on a regular basis because the prices they are happy with have already been set.
