Blockchain and Cryptocurrency Basic - Trading Terminologies: Buy Stop and Sell Stop

### Buy stop A buy stop order is basically a type of order that is popular and common in some of the top crypto exchanges. A buy stop order has to do with setting conditions that must be met before a trigger occurs. Simply put, a buy stop order is a conditional order that triggers the crypto exchange to only buy a particular cryptocurrency when the price hits a pre-specified price. Immediately the price of the cryptocurrency hits the pre-specified buy stop price, it would trigger the crypto exchange to fill the order and buy. For instance, the current price of MATIC is $1.52700 but the trader wants to buy MATIC at $1.68441. This is not possible in a normal trading situation because the trade would immediately fill from the best price which is the best market price at the time. However, it is possible for the trader to buy MATIC at a higher price than the current market price using the buy stop order. This order is beneficial when the trader is anticipating that the market would enter an uptrend. .png) ### Sell stop A sell stop order which can also be referred to as stoploss order, is also very popular and common in some of the top crypto exchanges. A sell stop order has to do with setting a condition that must be met before a trigger occurs. Simply put, a sell stop order or a stoploss order is a conditional order that triggers the crypto exchange to only sell a particular cryptocurrency when the price hits the pre-specified price. Immediately the price of the cryptocurrency hits the pre-specified sell stop price, it would trigger the crypto exchange to fill the order and sell. This is one of the most common orders for traders who want to reduce their losses if the price goes against their prediction[.](https://steemit.com/hive-108451/@chimzycash/steemit-crypto-academy-season-3-week-8-post-for-yohan2on) For instance, a trader buys MATIC tokens at the current market price of $1.52779. The trader has predicted that the price of MATIC would rise to $1.64075 so as to sell and make profit. However, the trader knows that the price of MATIC can still fall. So in order not to incur a huge loss if the price of MATIC does not rise but only falls, the trader can set a sell stop or a stoploss at a price lower than the entry price. The trader can set the sell stop price at $1.49725. If the price falls to $1.49 , it would trigger the exchange to sell and exit the market. However, If the price does not fall and continues to rise above the entry price, then nothing happens and the price can continue to go higher and higher to any point until the trader decides to sell. Sell stop order can also be used to protect a trader's profit[.](https://steemit.com/hive-175254/@chimzycash/blockchain-and-cryptocurrency-basic-trading-terminologies-buy-stop-and-sell-stop) When a trader is in profit, the trader can use a sell top to prevent losing all the profit when the price reaches the sell stop price. However, if the price continues to rise, the trader's profit would continue to increase until the trader decides to sell. .png)