Market and Limit Orders: What They Are and How to Create Them

What Is a Market Order?

A market order is executed at the current market price as quickly as possible when you place the order. This type of order guarantees immediate execution, though the exact price may differ slightly from the quoted price at submission.

When placing a market order, you can choose between two settings: [Amount] or [Total] for buying or selling.

Select [Amount] when you want to buy or sell a specific quantity of an asset. For instance, if you want to purchase exactly 0.5 BTC, this is the right choice. Use [Total] if you wish to invest a specific amount in a currency. For example, if you want to buy BTC with 10,000 USDT from your balance, the most effective method is to place a market order using the [Total] parameter.

You can generally use both options to set buy and sell orders. However, note that between the system's calculation of your expected amount and your order confirmation, the asset price may change significantly. In such cases, the order might fail or be partially filled. This typically occurs when you use your entire balance (100%) for the transaction.

Note: Selecting Amount creates a standard Market Order; selecting Total creates a Reverse Market Order. Both are types of market orders.

Market Order Example

Suppose an asset’s current price is 2,400. If you place a market order, your order will be filled immediately at the best available price in the order book at that moment. The average execution price may not match exactly 2,400. Depending on whether you’re buying or selling, the price may settle slightly above or below this level.

For buy orders, the average execution price may be slightly above the quoted price, as you’re purchasing from the best sell offers. For sell orders, the average execution price can be slightly below the quoted price, since you’re selling to the best buy offers. This price difference is known as slippage and is a normal feature of markets with varying liquidity.

How to Place a Market Buy Order

1. Using the Total Parameter

Suppose you have 1,000 USDT and want to buy BTC with a market order. When you choose "Buy 100%," the system executes your order at the current market price, using your entire USDT balance. However, the exact BTC amount you’ll receive is not guaranteed, as it depends on market prices at the time of execution.

The final BTC amount is determined by the market price and the funds you commit when placing the order. You can review the average execution price and total BTC purchased in your trading platform’s order history.

2. Using the Amount Parameter

For example, if you have 653.72520248 USDT and the BTC/USDT price is around 67,510.33 USDT, placing a "Buy 100%" order matches your funds against the best available sell offers to determine how much BTC you can buy.

If the system calculates you can buy 0.00968 BTC with 653.72520248 USDT and you submit the order, but the BTC price rises before execution, your 653.72520248 USDT is no longer enough to buy 0.00968 BTC, and the order will not complete. In this case, you can submit a new order by manually updating the BTC amount or use the [Total] parameter to resolve the issue.

How to Place a Market Sell Order

1. Using the Amount Parameter

Suppose you hold 100 BTC and want to sell 50% with a market order. The USDT (or other reference currency) value for selling 50 BTC is determined by the current market price at the time you submit the order. You can check the USDT received and your average sale price in your order history.

2. Using the Total Parameter

For example, if you have 0.00003093 BTC and the BTC/USDT price is around 67,740.62 USDT, placing a "Sell 100%" order matches your amount with the best available buy offers to determine how much USDT you’ll receive.

If the system calculates you can sell 0.00003093 BTC for 2.0245236 USDT and you submit the order, but the BTC price drops before execution, your 0.00003093 BTC can no longer be sold for 2.0245236 USDT, and the order will not complete. You can submit a new order by editing the desired USDT amount or using the [Total] parameter.

What Is a Limit Order?

A limit order is placed in the order book at a specific price you set. The order only executes when the market price reaches your limit price (or better). This order type gives you greater control over execution price, letting you buy at a lower price or sell at a higher price than the current market rate.

Limit orders are particularly valuable when you have a defined price in mind for entering or exiting a position and are willing to wait for execution.

Limit Order Example – Buy Orders

When the current price (A) falls to or below the limit price (C), the order is executed automatically. To trigger this, your buy limit price must be lower than the current price.

For example, if the current price is 2,400 (A) and you set a limit price at 1,500 (C), the order won’t execute until the price drops to 1,500 or lower. In this case, you aim to buy at a much lower price.

If you set a buy limit order at 3,000 (B), above the current price, the order fills immediately at the current market price (about 2,400), not 3,000. In this scenario, the order functions like a market order since the limit price is more favorable than the current price.

Limit Order Example – Sell Orders

When the current price (A) reaches or exceeds the limit price (B), the order is executed automatically. To trigger this, your sell limit price must be above the current price.

For example, if the current price is 2,400 (A) and you set a sell limit order at 3,000 (B), the order executes when the price hits 3,000 or higher. Here, you’re attempting to sell at a price above the market.

If you set a limit order at 1,500 (C), below the current price, the order is filled immediately at the current market price (about 2,400), not 1,500. Again, the order acts as a market order when the limit price is less favorable than the market price.

How to Create a Limit Order

To place a limit order on your trading platform:

1. Log in to your account and navigate to the spot trading section.

2. Select your desired trading pair (e.g., BTC/USDT).

3. Choose the "Limit" order type from the available options.

4. In the buy or sell section, enter your preferred limit price. For example, you want to buy BTC at 67,950 USDT.

5. Enter the amount of the asset you want to buy or sell in the [Amount] field.

Alternatively, use the percentage bar above [Total] to choose how much of your available funds to allocate. For instance, if you have 10,000 USDT and want to use 50% to buy BTC, set the bar to 50% and the system will automatically calculate the corresponding BTC amount for your limit order.

6. Click the confirmation button (such as "Buy BTC" or "Sell BTC") to place the limit order. Once the market price reaches your limit price (or better), your limit order will execute automatically.

How to Create a Stop-Limit Order

A stop-limit order combines features of stop orders and limit orders. It lets you set a trigger price (stop) and a limit price for execution.

To place a stop-limit order:

1. Go to the spot trading section on your platform.

2. Select "Stop Limit" or "Stop Limit Order" from the order options.

3. In the buy or sell section, enter the trigger price (stop price) and the desired limit price. For example, you want to sell BTC if the price drops to 67,000 USDT, but only if you can sell at 67,950 USDT or better.

4. Enter the amount of the asset you want to sell in the [Amount] field.

Alternatively, use the percentage bar to specify what portion of your assets you want to sell. For example, if you have 1 BTC and want to sell 50%, set the bar to 50% and the system calculates the corresponding values automatically.

5. Click the confirmation button (such as "Sell BTC") to place the stop-limit order. When the market price hits your trigger price and then your limit price, the order will execute automatically.

You can also place stop-limit orders via your platform's mobile app. Go to the trading section, select "Buy" or "Sell," tap the order type menu, and choose "Stop Limit" or the equivalent option.

How to View Your Order History

To monitor your trades and orders:

On the web platform:

View open orders in the "Open Orders" tab or section. To cancel a pending order, click the cancellation icon (typically a trash can or "Cancel" button) next to it.

Check filled (executed) orders in the "Trade History" or "Order History" section. This provides a record of all completed trades, including execution price, quantity, and date.

On the mobile app:

Log in to the trading app and access the spot trading section. Open orders appear under "Open Orders." To cancel, tap the "Cancel" button next to the order. Many platforms also offer a "Cancel All" option for batch-canceling pending orders.

Review filled orders in the "Order Records," "Trade History," or equivalent section, depending on platform terminology. This gives you a comprehensive record of all executed trades.

FAQ

What is a Market Order (Ordem a Mercado) and how does it work?

A Market Order executes immediately at the current market price without specifying a price. It is matched directly with existing limit orders in the order book, ensuring fast cryptocurrency transactions.

What is a Limit Order (Ordem Limite), and how does it differ from a Market Order?

A Limit Order lets you specify the execution price and may not be filled. A Market Order executes instantly at the current market price. Limit Orders offer price control; Market Orders prioritize speed.

When should I use market orders instead of limit orders?

Use market orders when immediate execution is critical, regardless of price. They’re ideal during extreme volatility or significant market moves, ensuring your order is filled right away.

How do I create and place a market order?

Select buy or sell, choose "Market Order" as the order type, enter the amount, and confirm. The order fills instantly at the current market price. Use smart routing for optimal execution.

How do I create and place a limit order?

Enter the asset and your desired limit price on the platform. Specify the quantity and order type (buy or sell). The order is filled automatically when the price hits your target.

What are the advantages and risks of using limit orders?

Advantages: precise price control, execution at your preferred or better price. Risks: if the price doesn’t reach your level, the order may go unfilled, potentially missing trading opportunities.

What risks do market orders carry?

Market orders are exposed to price volatility, which can cause execution at a price different from what you expect. In fast-moving markets, you might buy higher or sell lower than intended. Fast execution does not guarantee the best price.

Can limit orders go unfilled? Why?

Yes, limit orders may remain unfilled if the market price never reaches your set limit. If the price doesn’t hit your target during the order’s valid period, it will stay open and unexecuted.

What is the fee difference between market orders and limit orders?

Typically, limit orders have lower or equal fees compared to market orders. Market orders fill immediately at the current price, while limit orders may earn reduced fees by providing liquidity to the market.