A limit order is a conditional trading order that, when executed, will make trades only at the specified price or better.
Put simply, a limit order enables you to buy and sell cryptocurrencies for a predetermined price. Limit orders provide an excellent method of proactively managing your portfolio and making stock transactions in fast-moving market conditions. However, there are a few things you need to remember when using the order.
For instance, a buy limit order will only execute if your trade is placed at or below the specified price. In other words, you won’t pay more for a stock than the stated value in your limit purchase order. This is why it’s important to set a price that ensures you’re getting what you want at a good value. A sell limit order functions in the same way but sets an upper threshold on how much money you’ll receive in a sale transaction. If executed, your trade will make money if sold at or above the listed figure. This keeps your losses to a minimum should market volatility cause coins to plummet before it can be closed out at a later time .
In contrast to limit orders, market and stop orders can be executed at any time; but those types of transactions will make trades regardless of whether or not they prove to be profitable.