What is a trailing stop market order?
Understanding Trailing Stop Limit Orders in Cryptocurrency Trading
A trailing stop market order is a type of order that combines the features of a trailing stop order and a market order. A trailing stop market buy order is an order to purchase a cryptocurrency when it reaches a certain price, and a trailing stop market sell order is an order to sell a cryptocurrency when it reaches a certain price.
In a trailing stop market order, the stop price is set at a certain dollar amount below or above the market price. For example, if you placed a trailing stop market sell order for bitcoin at a $100 trailing stop, your order would be triggered if the price of bitcoin drops $100 from the highest price it has reached since you placed the order. Once the order is triggered, it becomes a market sell order, meaning that the bitcoin will be sold at the best available price.
A trailing stop market order with dollar amounts can be useful for traders who want to set specific price targets for buying or selling a cryptocurrency and are willing to accept the best available price for their trades. However, it is important to note that market orders may not always be filled at the desired price, particularly in fast-moving or volatile markets.
Pros of a trailing stop market order:
- Allows you to set specific price targets for buying or selling a cryptocurrency.
- Automatically adjust the stop price as the market price of the cryptocurrency moves in your favor.
- Can help you to lock in profits or minimize losses.
Cons of a trailing stop market order:
- May not always be filled at the desired price, particularly in fast-moving or volatile markets.
- May require you to constantly monitor the market and adjust your trailing stop market orders as the price of the cryptocurrency changes.
How do I place a trailing stop market order on Ndax?
Desktop
- Go to the Ndax website (https://ndax.io/) and log in to your account.
- Once you are logged in, you will be taken to your dashboard.
- On the left-hand side of the dashboard, click the TRADE button.
- On the trade page, you will see a BUY and SELL button on the right side of the screen. If you want to buy a cryptocurrency, click the BUY button. If you want to sell a cryptocurrency, click the SELL button.
- To select the cryptocurrency/CAD pair you want to trade, click the small grey arrow in the upper left corner of the screen. From the dropdown menu, select the desired pair.
- To place a trailing stop market order, click the TRAILING STOP MARKET button.
- In the ORDER SIZE field, enter the amount of cryptocurrency you want to buy or sell.
- In the TRAILING STOP field, enter the dollar amount or percentage at which you want the order to be triggered. For example, if you want the order to be triggered if the price of the cryptocurrency drops $100 from the highest price it has reached since you placed the order, enter $100.
- Once you have entered the necessary information, click the PLACE BUY/SELL ORDER button to submit your trailing stop market order.
To learn more about Trailing Stop Market Orders, check out our blog:
Advanced Trading: Bitcoin Trailing Stop Market Order