12.08.2020
Crypto orders

You have your orders: the best guide to trading orders in cryptocurrency

If you’re not a fan of 56% taxes*, transactions that take days, and SUDDEN account freezes, you’re probably seeking for an alternative to conventional banking. Learning trading is not easy though, and the first thing to learn is order types.

If you’re already in fintech or related fields, trades are your friends and you can do technical and fundamental analysis in your head faster than Tradestation (!). Then you also know trading is probably the best way to make (and keep) a lot of money quick legally, and how complicated and stressful classical trading is. 

Successful traders

Even if you’re new to this niche, the odds are that the first two facts you learned about Forex were about fortunes to be made and people taking a dive from 200+ floor window. 

How to avoid the latter and have more of the former in cryptocurrency trading? In an ideal world, trading would be fun, easy, and rewarding with zero risks and stress. And some traders actually have a good time and win big. Successful traders have money, fun, and plenty of property – but how are they succeeding? 

Crypto sell and buy orders: the difference between winning and losing

The secret to losing as little money as possible and getting the most out of any business is knowing your field and using the right tools. The more customizable these tools are, the better. One example is being stranded at sea (which is what trading often feels like for newbies, especially with Bitcoin whales and loan sharks always circling the liquidity). 

You’ll be very happy to see a buoy if you’ve been drifting in the sea for some time. Having a boat with an engine is even better. Or even some food and water. Or even some wine from the south of France. And cheese. Definitely cheese. Getting carried away here, but the types of tools you use can genuinely make a huge deal of difference. The more specialized they are, the more useful. 

buoys and boats

Don’t bring a knife to a gunfight: picking crypto market orders

Advanced order types (you guessed it) advanced, meaning, like boats as opposed to buoys, they will get you much better results.

A talentedly placed trailing stop loss order will get you more or less guaranteed wins. Some order types will right off the bat save you money on slippage. Of all of those, market orders are basic and cheap and will, like all cheap things, cost you a lot of money. The more advanced orders an exchange offers, the better. 

Which is why Nominex, along with a mastodon load of other awesome features, thoughtfully provided you with the best order types there are. 

Top crypto market orders

Most people think of a market order as the simplest and probably the worst type of order. When you place a market order, it immediately executes based on “the best market price”. Which is not the price you’re looking for.

This can be irritating if you’re trying to sell something at $100 apiece, of which you have 10, and you’re counting on getting $1000 out. 

Slippage

However, the best market price is $100 only for two of them, and while the exchange is trying to match more orders the price is going down, so the best ones left are 3 orders for $95, 2 orders for $90, and 4 for $88. The result you get is a lot less than $1000. 

This is called slippage. Think of slippage as Lord of The Rings and Sauron slipping and dropping The Ring back into Mount Doom right after making it. No story, no glory, nothing. Embarrassing! 

Limit orders cryptocurrency

Limit orders are much better. You’re holding assets, which you bought for an amount of $10 000, for example, and you want to sell them at $15 000 to ensure profit. You set your order limit to $15 000 and forget about the sale and the associated stress until the market makes you money by itself. Two points to note!

One, there is the option of setting the time interval the order can live for before it cancels itself. 

Two, it may very well be that you buy the BTC for $10 000 and set the limit order to $15 000. Will you be still as happy when your order is executed, you get paid, and afterward the price goes to $250 000? Ouch! Crypto is more than just a pretty tail: HODLing it may very well make you a fortune.

Stop orders in cryptocurrency

Stop orders

Stop orders are simple and efficient. If you want to cut your losses, seeing that the price is going down and you won assets which you bought at $8000, you set a Stop Order at $7500 and, should the market crash, instead of losing a lot of money and your mental resources you lose only some. 

Use with caution! Crypto loves you but it will crush you if you’re not careful. It also works the other way around: you may cut your losses and sell at $7000 and find out from the papers crypto is at $140 000 a year later. How to avoid drama? Diversify. 50% HODL, 50% is not a bad idea. 

Stop Limit Orders 

When you set a Stop Limit Order, there is better security (two bodyguards are better than one) and two components to your actions. 

The Stop Price is the price you set so that the order is activated when the market reaches it. 

The Limit Price is the price which the order will be filled at when that price is reached. So you can wait for your BTC, which you bought for $10 000, to reach $14 000 (the stop price), which is when your order will come alive, and since the limit price you set is $17 000, it will get sold at $17 000 (hopefully when it goes higher).

Scaled orders 

Those dealing with large volumes know that placing an order on the market will affect the price. If you’re selling 500 BTC for $8 000 each all in one go the price will drop because there is more of an asset in the market and therefore it’s cheaper. No fools in crypto: the market reacts in a flash.  The price will start going down not after but as you’re selling, meaning every next buyer will buy it cheaper, and you’re losing money. 

What you can do is break down your large block of BTC so that you sell in smaller portions and watch the price yourself. Which is time- and resource-consuming.

Scaled orders give you the option of breaking down your larger orders automatically which are then placed as limit orders to make sure the market isn’t getting upset by the movement of large funds and that your orders are getting filled at the price you need. 

Trailing stop orders

A trailing stop order is your best friend in the time of need. Why? Like a weaponized drone hanging over your shoulder in battle, it serves and protects, and it has its own intelligence. Trailing Stop orders follow specific price changes by themselves.

The market is going up, and you set the Trailing Stop order at $300 below the asset price. It was at $8000 an hour ago, now it’s $9000 and your order in that time moved from $7700 to $8700 ($300 below) – all by itself. If the market moves lower, the order stays where it is, guaranteeing that if the price crashes, you will still make [profit. A Stop Loss order is a way to get all the best out of a market and none of what’s worst. 

Warning! Keep your PC on as you set the order! It only works on your end.

Trailing Stop Future orders 

These bad boys are advanced orders of the advanced orders. Like Special Ops, they come in where no other order type is capable of getting the job done. You use Trailing Stop Future Orders for points in time in the future the market you think will reach that Trailing Stop Losses are insufficient for:

You are in a long position and the current market price of BTC is 10,000 USD. You would like to sell BTC when the price reaches at least 11,000 USD using a Trailing Stop order. The market is volatile and you think that the price may fall under current 10,000 USD before going up to 11,000 USD. Therefore a usual Trailing Stop order would close too early. With Trailing Stop Future order the Trailing Stop will be activated only if the price reaches 11,000 USD. It may come in handy if you don’t want to lose a moment while being offline. — Nominex

Besides the best orders available, Nominex offers spectacular benefits you don’t find anywhere else under the same roof: an outstanding referral program with unlimited levels to reap benefits from, lowest commissions with additional discounts for NMX token holders, wildly fun tournaments, and the opportunity to purchase tokens during the first of its kind In-Demand Coin Offering, which is happening right now. And yet lots more. 

You can find more reasons why Nominex is simply the best here

*Always pay your taxes! However, crypto taxes are 13% (rates may vary geographically).

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