The world of cryptocurrency trade: Understanding limited orders and soil prices
The world of cryptocurrency trading is developing quickly, with new possibilities. Since the market continues to grow, it is important for dealers to understand the basic concepts behind the cryptocurrency trade, including border orders, soil prices and much more. In this article, we will process the basics of these terms and give a complete guide for effective use in your commercial arsenal.
What is a border control?
A limit order is an instruction with a trading platform to buy or sell a certain cryptocurrency at a given price. It is essentially a “loss of stop” for your position and limits the potential loss if the market accumulates against you. A border control can be placed at any time before the specified price so that retailers can block profits or reduce losses.
soil price: the starting point
The price of the soil is the minimum price to which a cryptocurrency can be negotiated on the stock market like Binance or Octopus. It is also known as the “floor” of the market. The price of the soil serves as a reference point for the purchase and sale of prices and offers a reference base with which the dealers determine your level of stopping.
Types of limits order
There are different types of border orders:
* Market order : Buy or sell at the current market price.
* Limit Buy : buy at a certain price (for example $ 100).
* Sell limit : sale at a certain price (for example $ 50).
* STOP LOST Limits Order
: Set a stop-loss level and automatically carry out a border control when reaching.
Solid price mechanics
The price of the soil is influenced by various factors, including:
- Offer and request : If the market is in balance, the price of the soil remains stable.
- Feeling on the market : Mood changes in the market such as optimism or pessimism can influence the price of the soil.
- Exchange costs : The costs charged for exchanges on a certain scholarship can affect the price of the soil.
Example: Use the limits of limits and soil prices
Suppose you buy Bitcoin (BTC) for $ 40,000 and give up a stop limit for sale if it falls below $ 39,500. If the market rises considerably up or down to the execution time of your position, your border order will be made automatically, which has triggered a stop sale.
To illustrate this concept:
- Your order form will be abandoned with the current price of $ 40,000.
- You define a stop-loss limit command for the sale of $ 39,500 when the market reaches this level.
- If the market increases to US $ 45,000 by the time of execution of its position, your limit order will be carried out automatically and will sell it from trade.
Diploma
Mastering boundary orders and soil prices is of crucial importance for a successful exchange in cryptocurrencies. By understanding the operation of these concepts, retailers can determine their own level of stopping, manage risks and make good decisions at the time when profits or losses must be reduced. Do not forget to always test your strategies before managing them in the live markets to avoid costly mistakes.
Additional advice
- Always keep an eye on market trends, news and events that can affect the price of the soil.
- Use technical indicators such as B. Mobile average values and RSI to measure the mood on the market and adjust your border orders accordingly.
- Consider determining a report of “risk expectations” if you abandon border orders to compensate for potential benefits with potential losses.
Find out more
Further information on trading of cryptocurrencies and limitation of orders can consult the following resources:
- Official blog of binances
- Kraken sales guide
- Investopedias cryptocurrency articles
By understanding border orders and soil prices, they are better equipped to sail in the complex world of cryptocurrency trade. Do not forget to stay up to date, to face risk management and to adapt to changing market conditions in order to obtain optimal results in this exciting space!
