Order Types

Definition ∞ Order types are the various instructions traders use to specify how their buy or sell requests should be executed on an exchange. These instructions determine conditions such as price, timing, and duration for a trade. Common examples include market orders for immediate execution at current prices, limit orders for execution at a specified price or better, and stop orders for triggering a trade once a certain price is reached. Selecting the correct order type is essential for managing risk.
Context ∞ Understanding different order types is fundamental for effective trading in cryptocurrency markets, impacting execution quality and risk exposure. News articles and trading guides frequently explain the utility of various order types in response to market conditions. The availability and sophistication of order types vary across centralized and decentralized exchanges, influencing trading strategies.