What is a stop-limit order?
The stop-limit order is essentially a limit order, but you can easily understand it as a conditional limit order. The condition is that you need to set a stop price(trigger price) in advance. When the latest market price reaches this trigger price, the order will be sent to the market automatically at the limit price as you set, and waiting to be executed.
A stop-limit order will be executed at a specified (or potentially better) price after a given stop price has been reached. Once the stop price is reached, the stop-limit order becomes a limit order to buy or sell at the limit price or better.
Explanation of SL (stop-limit) mechanics:
When submitting the stop-limit order, you need to enter the following information in the order dialog box:
- Stop price
Literally, this is the price that triggers your order, which means that your stop-limit order will be triggered when the latest local market dealt price (i.e., the last price) reaches the 0.0380 as you have set.
When the current asset price reaches the given stop price, the stop-limit order is executed to buy or sell the asset at the given limit price or better.
- Limit price
A stop-limit order is also a limit order, but a conditional limit order. The 0.0381 price you set in the screenshot above is the execute price at which you will execute your stop-limit order and the limit price at which I will send this order into the market.
The short answer is, the selected (or potentially better) price that the stop-limit order is executed at.
The number of assets to buy or sell in the stop-limit order.
So, for example, in the screenshot above, when you click Submit [BUY OCE], this stop-limit order will be submitted. When the local market price reaches 0.0380, this stop-limi order will be triggered, and the order will be sent to the market with 10,000 OCE amounts at the limit price of 0.0381, and waiting to be filled.
- Trigger: Eliminate system failure and other factors. When the latest trading price in the local market reaches 0.0380, your stop-limit order will be triggered.
- Execution: Once the stop-limit order has been triggered, it's the execution time. Whether a limit order can be executed depends entirely on the local market. For this part you can refer to the general limit orders. Assuming that the comparison of your execute price set deviates from your trigger price (the latest trading price in the local market), then it is likely that the order will not be completed immediately, you will need to wait. Therefore, the stop-limit order actually is triggered but not executed, that is, you set a limit price that deviates too much from the market price, and no one is willing to take the order (you can't take anyone else's order, either). Therefore, when you submit stop-limit orders, it's not just the trigger price you have to think about, you also consider whether the execute price is reasonable.
- Cancellation: A stop-limit order, like an ordinary limit order, can be cancelled if it is not triggered, not executed, or not completed after execution.
The last traded price of BTC is 28,200 USDT. If a user believes that the price will continue surging up if it breaches the resistance at 30,500 USDT, he may place a Stop-Limit with the following parameters:
- Stop-Limit: 30,500 USDT
- Order price: 30,550 USDT
- Volume: 1.5 BTC
Our system will then automatically send a limit order with the above parameters to the order book when the last traded price reaches 30,500 USDT. This would save the user's time from monitoring the market.