Rapid price movement coupled by a decisive strategy is what makes bitcoin exciting. However, to execute your strategy, you need the right platform that complements your enthusiasm. Ease and simplicity of trading is crucial to good user experience. While trading itself can be complicated for some, trading bitcoin can seem overwhelming, given that it’s only about a decade old and sees a fair bit of volatility from time to time.
Whether it’s the stock markets or a cryptocurrency exchange, orders are the most essential part of any trading activity. Simply put, orders are a command or a direction for how you are going to buy or sell crypto on a trading exchange.
Before we discuss the different types of orders, here’s a quick look for the uninitiated into what is an order book.
All trades that get executed on an exchange get reflected on its Order Book. The order book allows traders to measure liquidity when they place an order to buy or sell crypto from an exchange. An order book lists all orders (buy / sell) as they are placed by users and thus becomes an entire list of available buy/sell orders on an exchange. Zebpay operates with an Open Order Book, and allows traders to leverage its benefits.
Let’s now understand the different types of orders available on Zebpay exchange, what they mean and how you can best use them.
Types of orders
Much like trading in traditional financial markets, there are various types of orders you can execute on a crypto exchange platform. Zebpay allows traders to execute a variety of crypto trading strategies with a range of order types. From Market to Stop-Limit Orders, there’s much you can do to suit your trading needs.
Market Order
Market Orders are used to buy or sell crypto at the best available price at any given point in time. A Market Order executes within seconds of placing the order (given that crypto is a 24x7 market, you need not worry if the time is right or not!).
This order type is your go-to when you give more weightage to your order getting executed at that precise point in time, rather than at a certain price.
At Zebpay, we offer Immediate or Cancel (IOC) Order for users. As the name suggests, an IOC order requires all or part of an order to be executed immediately. If there is a seller/buyer matching your order, it will be executed instantly. If any part of the order is unfulfilled, it gets cancelled automatically. IOCs allow completing of large orders at a particular price.
Limit Order
A Limit Order is a type of order used to buy or sell a stock at a specific price. A buy/sell Limit Order is triggered once the price of a selected coin reaches the specified Trigger price (also known as the Stop Price). (as defined by you).
A Buy Limit Order can be executed at the set limit price or lower. A Sell Limit Order can be executed at the set limit price or higher. For example, if your Buy Limit Order is at $100, you will only purchase crypto at a price of $100 or lower. Similarly, if your Sell Limit Order is at $100, you will only sell crypto at a price of $100 or above.
A Limit Order cannot be guaranteed to be executed as the certainty of whether the market will hit that price cannot be ascertained. Limit Orders are valid for 28 days on Zebpay.
Stop-Limit Order
A Stop-Limit Order is one that is executed within a specific price range (buy or sell limit price or better) and not as a Market Order. A Stop-Limit Order will revert to a normal Limit Order once it’s triggered.
A Stop-Limit is a conditional trade to buy and sell crypto that acts to stop any loss over a set limit price. The Stop-Limit feature is helpful in preventing excessive losses and is a secure way to automate orders without constantly needing to watch the market.
For example, let’s say you purchased 1 BTC at $3500. You notice a price drop and you may want to exit your position at nothing less than $3400 to prevent further loss. You can place a Sell Stop-Limit Order with the limit price at $3400 and a stop price of $3405. Once the price falls to $3405, it will automatically trigger the Limit Order to sell your BTC at any price at or under the limit you’ve set i.e. $3400.
Stop Limit can limit losses and lock-in profit, thereby making it a valuable tool in managing risk. These orders are valid for 28 days on Zebpay’s order book.
Different order types are an essential tool in a crypto user’s toolkit. Leverage this know-how to execute a comprehensive range of strategies.
*Do note that these order types are available in our order book that is available to customers of our Global exchange. We currently offer the Instant Buy/Sell model in Australia.
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