A Stop-market order is an order that allows to buy or sell a cryptocurrency at the market price as soon as the trigger price at which the order to buy or sell should be filled. The general purpose of a stop order is the opposite of a limit order, where instead of buying or selling cryptocurrency at a specific price, it will be filled at the best price available at the time when the trigger is executed.
Create Stop-market order
The Stop order is available only for spot trading and it can be accessed on the Trading page. To create a Stop market order, head to the trading widget and select the Stop tab.
Now we need to enter the order's parameters:
Select a side (buy or sell coins). Please note, that the Buy price should be above the current price, and vice versa, the Sell price should be below the current price. Otherwise, the order will be executed instantly, use the limit order instead.
Enter the trigger price in the Price field.
Enter the number of coins to buy or sell in the Amount field.
Alternatively, you can enter the Total amount of the opposite currency that should be spent for buy order or received for sell order.
Optional: Activate any extra features such as Take Profit, Stop Loss, or Trailing.
When you are ready, click on the confirmation button to create your stop-market order.
View and manage your open Stop orders
Once you place a Stop-market order, it will be converted to a "Stop" type in the Open Orders tab. You will be able to modify SL and TP levels at any time if you have had either of them enabled during the order placement process. To do so, click on the pencil (edit) icon.
Enable, disable, or adjust TP and/or SL. Once all the changes have been made, press the Save button.
Situations when Stop-Market order can be used
There are no limitations to the creativity or usability of any service, anything can be used differently based on personal strategies and choice. However, we highlight the two most important use cases where the Stop-Market order can become handy.
When the price makes a resistance breakout it usually brings more volumes to the market which will push the price even higher. Having your stop buy market order will guarantee you to enter the trade as soon as the key resistance is crossed.
Support breakout & Eliminating slippage
Another use case for the Stop-Market order is to do the opposite on the support breakout when it is necessary to leave the market to prevent further losses. The main difference here between the Stop-Limit and the Stop-Market is that the Stop-Market order will ignore the slippage that may occur in the order book and will guarantee that your coins will be sold at the best price possible.
The difference between a Limit order and a Stop order
There are two main differences between limit and stop orders:
A limit order is visible for the market participant,s and can be only filled at a specific price or better.
Unlike a limit order, a stop order isn't visible in the order book and will be executed at a market price after a given stop price has been reached.
A limit order is an order used to buy or sell a coin for a specific price. However, you cannot set a limit order to buy a coin above the market price because a better price is already available.
A stop order will turn into a market order once your stop price is met or exceeded. A stop order can be set as an entry order as well. This type of order can be set above the current market price.