Order Types
Market orders, limit orders, stop-loss, and take-profit explained
Documentation
Understanding Order Types
Cafe Trading offers various order types to help you execute your trading strategy effectively. Each order type serves different purposes and understanding when to use each one is crucial for successful trading.
Basic Order Types
- Market Orders
- Limit Orders
- Stop Orders
Advanced Order Types
- Stop-Loss Orders
- Take-Profit Orders
- Conditional Orders
Market Orders
Market orders execute immediately at the best available price in the market. They guarantee execution but not the exact price.
Advantages
- • Immediate execution
- • Guaranteed to fill
- • Simple to use
- • Good for urgent trades
Disadvantages
- • Price slippage possible
- • No price control
- • Can be expensive in volatile markets
- • May get poor fills
Best Used For
- • Quick entries/exits
- • Liquid markets
- • Emergency situations
- • Small position sizes
Limit Orders
Limit orders execute only at your specified price or better. They give you price control but don't guarantee execution.
Advantages
- • Price control
- • No slippage
- • Better execution prices
- • Can catch price spikes
Disadvantages
- • May not fill
- • Requires monitoring
- • Can miss opportunities
- • Time-sensitive
Best Used For
- • Precise entries
- • Better prices
- • Non-urgent trades
- • Large positions
Example:
If USDT/THBT is trading at 36.50, you can place a buy limit order at 36.40. The order will only execute if the price drops to 36.40 or lower.
Stop Orders
Stop orders become market orders when the price reaches your specified trigger level. They're essential for risk management and automated trading.
Stop-Loss Orders
Automatically close losing positions to limit losses.
- • Triggers when price moves against you
- • Converts to market order when triggered
- • Essential for risk management
- • Should be set before entering trade
Stop-Entry Orders
Enter positions when price breaks through key levels.
- • Triggers when price moves in your favor
- • Good for breakout strategies
- • Helps catch momentum moves
- • Can be used for trend following
Important Note:
Stop orders don't guarantee execution at the exact stop price, especially during volatile market conditions or gaps.
Take-Profit Orders
Take-profit orders automatically close profitable positions when your target price is reached, helping you secure gains without constant monitoring.
How They Work
- • Set target profit level
- • Automatically execute when reached
- • Remove emotion from profit-taking
- • Can be modified while position is open
Best Practices
- • Set realistic profit targets
- • Consider risk/reward ratios
- • Use technical analysis for levels
- • Don't be too greedy
Order Combinations
Combining different order types creates powerful trading strategies that can automate your risk management and profit-taking.
Bracket Orders
Combine entry, stop-loss, and take-profit in one order.
- • Entry order (limit or market)
- • Stop-loss for risk management
- • Take-profit for securing gains
- • Fully automated trading
OCO Orders
One-Cancels-Other: Two orders where one cancels the other.
- • Stop-loss and take-profit together
- • Breakout and breakdown scenarios
- • Reduces monitoring requirements
- • Prevents over-trading
💡 Pro Tips for Order Management
- • Always use stop-loss orders to manage risk
- • Set take-profit levels based on technical analysis
- • Don't move stop-losses against you
- • Consider partial profit-taking at key levels
- • Review and adjust orders based on market conditions
- • Practice with small sizes before using larger amounts