A stop-limit order is a limit order that has a stop price. When the stop price is reached, it triggers the limit order.
Stop-limit terms and mechanics:
- Stop price: When the asset’s price reaches the given stop price, the stop-limit order is executed to buy or sell the asset at the given limit price or better.
- Limit price: The selected (or potentially better) price that the stop-limit order is executed at.
- Quantity: The quantity of assets to buy or sell in the stop-limit order.
Attention: When the market price reaches the limit price, the stop limit order will be executed. When the stop limit is too high or the taker profit price is too low, your limit order could not be filled as the market price could not reach the stop price.