Hi everyone, in this article we will tell you what stop-limit orders are and how to use them on Tsunami Exchange. 🐳
First of all, let's turn to the concept of limit orders. Limit orders are orders that are executed when the price of an asset reaches a certain value. You can already use limit orders on all Tsunami pairs, but we went further and today we offer you stop limit orders.
What is it?
A stop-limit order is a so-called preset limit order, which is placed in advance and triggered when a certain price is reached.
Let's consider a case in which a user wants to set a limit order "long" at Waves price equal to 1.7$. The current price of Waves is 1.6$.
The user believes that if the price reaches the resistance line of 1.9$, a correction to the level of 1.7$ will follow, after which Waves will return to growth.
So, he holds a long position with take profit at $1.9 and creates a stop limit with Stop price of $1.9 and Limit price of $1.7. Thus the order will be created only if the price reaches 1.9$ and will be executed when the price returns to 1.7$.
How long does a stop-limit "live"?
When placing a stop-limit order, the user has 60 days to let the price of an Asset reach a certain set value. After that the order will have to be placed again.
Benefits of stop-limit orders
The user no longer needs to wait until the price in a pair reaches a certain level, but can specify in advance the condition under which a limit order will be created;
The user does not pay commissions to the protocol for holding a stop-limit order (only for the execution of transactions);
The trading process becomes more automated.
We congratulate our users on the release of the update and still strive to take center stage for trading in the Waves ecosystem! 🚀
Your Tsunami Team! 💙