A stop-limit order in the context of cryptocurrency trading is a two-step order that combines elements of a stop order and a limit order.
Stop Price: The stop price is the trigger point for the order. When the cryptocurrency’s price reaches or surpasses this specified stop price, the stop-limit order is activated.
Limit Price: Once the stop price is reached, the stop-limit order converts into a limit order. The limit price is the specific price at which the trader wants the trade to be executed. However, there’s no guarantee that the limit order will be filled if the market conditions don’t allow for it.
This order type is used by traders who want to control the price at which their order is executed after a certain trigger point is hit. It provides a level of control over the trade execution, but it may not guarantee immediate execution if the market moves too quickly or if there’s not enough liquidity at the specified limit price.
