Technical Definition
Limit order
A limit order instructs a trading venue to buy or sell only at a specified price or better.
By Crypto University Editorial
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✦ Key Insight
Limit orders provide greater control over execution price, especially in volatile or thin markets.
✕ Common Misconceptions
Reaching the limit price does not guarantee a complete fill because other orders may be ahead of yours.
Detailed Explanation
A buy limit sets the maximum price you are willing to pay. A sell limit sets the minimum price you are willing to accept. The order may remain unfilled if the market never reaches your price.
In Practice
“ETH trades at $4,000. You place a buy limit at $3,900. It will not execute above $3,900.”
Dig Deeper
Liquidity
Liquidity describes how easily an asset can be bought or sold in meaningful size without causing a large change in price.
Order book
An order book is a list of open buy and sell orders arranged by price on a trading venue.
Market order
A market order instructs a trading venue to buy or sell immediately using the best available prices.