Placing your first limit order, step by step

When you buy or sell on an exchange, you are trading against other people's orders sitting in an order book. A market order takes whatever is available right now. A limit order does the opposite: you choose the exact price you are willing to pay or accept, and your order waits in the book until someone agrees to it, or until you cancel it.

Limit orders are one of the first tools worth learning, because they put you in control of price. The trade-off is that there is no guarantee your order will ever fill.

How the order book decides who trades

Every market has two sides. Bids are buy orders, sorted from the highest price down. Asks are sell orders, sorted from the lowest price up. The gap between the best bid and the best ask is called the spread. When a new order arrives that crosses the spread, such as a buy priced at or above the best ask, it matches immediately. Orders resting at the same price are filled in the order they arrived, which is known as price-time priority.

If your limit price does not cross the spread, your order rests in the book and becomes part of the visible depth that other traders see and can trade against.

Placing the order

1. 1Open the market you want to trade, for example BTC/USDT, and look at the latest price and the order book.
2. 2Choose Limit in the order panel and select Buy or Sell.
3. 3Enter your price. For a buy, a price below the current best ask means you are waiting for the market to dip. For a sell, a price above the best bid means you are waiting for it to rise.
4. 4Enter the amount in the base asset, or use the percentage shortcuts to size the order against your available balance.
5. 5Read the order total, then submit. The funds the order needs are reserved (locked) straight away, so they cannot be spent twice.

What happens next

Your order appears under Open orders. It can fill completely, fill partially, or not fill at all. A partially filled order keeps its remaining amount in the book until it completes or you cancel it. Cancelling releases whatever locked funds have not been used.

Fees on limit orders

An order that rests in the book and is matched later adds liquidity, so it is charged the maker fee. An order that matches immediately removes liquidity and pays the taker fee. A limit order can be either, depending on whether it crosses the spread when it arrives. The current rates for every market are listed on our fees page.

Common mistakes to avoid

• Typing an extra zero. Always read the total before confirming.
• Entering a buy price above the market by accident. The order then fills straight away against the best available asks instead of waiting.
• Forgetting about resting orders. An old order can fill weeks later if the price comes back to it.
• Assuming a limit order protects you in a fast market. If the price moves past your level and keeps going, your order may simply never fill.