Introducing Crypto Trading Order Types
Once you have found a crypto trading software or crypto exchange platform that best suits your needs, then you will have to learn how to buy cryptocurrency or how to configure your buy and sell orders according to your trading strategy.
1. What are Crypto Trading Orders
2. What are the Types of Crypto Exchanges
3. How to Configure Types of Order on Your Crypto Trading Platform
4. Crypto Trading Order Type: Market Order
5. Crypto Trading Order Type: Limit Order
6. Crypto Trading Order Type: Limit Ladder Order
There are different order types for cryptocurrency trading with some of the most common being the market order, limit order, and limit ladder order. There are other types of order depending on your crypto trading strategy and your chosen crypto trading software.
What are Crypto Trading Orders
But what are crypto trading orders types? Basically, orders are instructions to buy or sell altcoins or trade Bitcoin on the cryptocurrency exchange. These orders can either be simple or complicated depending on your trading method. They can also be sent either through middlemen called as crypto exchange brokers or directly if you have access to the crypto markets.
Types of Crypto Exchanges
There are two types of cryptocurrency exchanges - centralized crypto exchange and decentralized crypto exchange.
Binance, Coinbase, and Kraken are examples of centralized crypto trading platforms. In these centralized exchanges, you can store digital assets and exchange them for digital currencies like Bitcoin and altcoins.
The other type is a decentralized crypto exchange which removes the middlemen - traders have direct access to the crypto market and can buy and sell crypto from peer to peer. With these digital currency exchange platforms, you are required to be extremely careful of your private keys because your funds may not be retrieved once you have lost access to your keys.
How to Configure Types of Order on Your Crypto Trading Platform
A lot of people ask the question, “Is crypto trading profitable?” Well, it is actually a lucrative activity that can let you earn Bitcoin, earn altcoins, or grow your digital assets. However, you also need to know that there are great cryptocurrency trading risks. It is, therefore, essential that you follow a crypto trading strategy and be very careful when setting your crypto trading orders.
The Altrady cryptocurrency trading platform allows you to have different configurations for your crypto trading order type such as limit, limit ladder, and market order. Each of these orders has its own advantages and disadvantages depending on your trading strategy and profit goals.
Crypto Trading Order Type: Market Order
Market orders are immediately executed at the prevailing coin market price without the need to specify price limits.
Advantage: Traders consider crypto market orders to be the fastest and most reliable means of entering or exiting a specific coin market. Since there are no qualifications to be met for executing the trade, most market orders are immediately filled.
Disadvantage: Since crypto markets can be very volatile with price changes happening fast, your order may be filled with a prevailing price other than you expected. Market orders are not beneficial for stop-loss purposes where traders need to limit potential losses on his assets.
Crypto Trading Order Type: Limit Order
A limit order is a type of trading order to buy or sell a coin at a specified price or better. Buy limit orders will only be executed at the limit price or a lower one. Sell limit orders will be executed at the limit price or a higher one.
Advantage: With limit orders, you can guarantee the price by which the order will be filled. You can be sure that transactions will only take place on your desired price level or better.
Disadvantage: If the coin market does not meet the order qualifications, then the limit order will not be executed. This can result in missed trading opportunities in a fast-moving cryptocurrency market.
Crypto Trading Order Type: Limit Ladder Order
Limit Ladder orders basically allow you to set your buy and sell orders in increments. This type of order allows you to implement a laddering strategy whereby you move in and out of positions in small amounts instead of doing it one-time.
Advantage: Setting limit ladder orders for both buys and sells can significantly reduce your trading risks and protect you from irreversible losses.
Disadvantage: Limit ladder orders may take time to be executed because of the many qualifications for fulfillment. It is not recommended when you want to enter or exit a market at the fastest time.
You can personally check how these crypto trading order types work for you.
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