Stop Limit Buy work very similar to Stop Loss Limit.
In Stop Limit Buy a Limit Buy action triggers when the market reaches the Stop value. It majorly used to buy a coin at a lower price as close to the trough.
Below are the step used to place Stop Limit Buy:
- Select Stop Limit Buy order type.
- Select Base and Quote coin.
- E.g. Market: BTC/BCH
- Select the number of coins needs to be bought.
- E.g. 10 coins. (quantity could be in the fraction)
- Enter stop value. Stop value is the target price at which a subsequent (Limit Buy/ Trailing Buy) order will be executed. Once market will dip to Stop price, a Limit Buy order will be executed.
- E.g if the current ask price of BCH is 0.1493 BTC.
- Stop value can be set as 0.1400 BTC which is 6% less from the current market.
- Suppose market just hit 0.1398 BTC. This will trigger a BCH Limit Buy Order at price .1350 BTC.
- The trailing field is optional. If it is selected, one needs to enter offset in percentage (Trailing value). On click of submit button, a Stop Buy trailing order will be placed. Click Trailing Stop Buy to learn more.
- E.g. This option is selected, and 3% offset is entered for BCH.
- Suppose market just hit 0.1398 BTC. This will execute a BCH Trailing Stop Buy order.
- Imaging market starts losing and reaches to through value 0.1300. After that, it starts rising.
- Since order is Trailing Stop type, it would save loss and execute market buy when the price hit 0.1339 BTC
Caution: Stop price should be a less current market price (ask price).
A hypothetical example:
Case 1 without Trailing:
Suppose current price of NEO is $100. Now someone placed a Stop Limit buy order, for 1 NEO coin with stop value $90 and a Limit value $87. Now when the NEO ask price dips less than or equal to $90, a Market Limit Buy will be placed at $87.
Case 2 with Trailing:
Suppose current price of NEO is $100. Now someone placed Stop Limit buy with Trailing order, for 1 NEO coin with stop value $90 and Trailing offset 5%. Now when the NEO ask price dip less than or equal to $90, a Trailing Stop Buy order will be placed. Let’s say market corrects further reached to the trough $80 and then start rising again. The time when the market reaches $84, a Market Buy will be placed.