Hello. I've been doing a lot of reading on setting buy/sell limits, and buy/sell stop limits. I understand what these settings do for the most part, but I have questions about having the settings work properly in conjunction with one another, or if they interfere with eachother.
For instance, let's say I only have $1000 and the market price for bitcoin is $1000. I buy $1000 worth. Now, I want to make a $1000 profit, so I set a (sell limit) at $2000. So the market price goes up to $1900, but then it starts to fall and is on its way down. I set a (sell/stop limit) at $1500. If the market reaches down to $1500, that will trigger a sell, so I'd end up with a $500 profit instead. I believe that's what the sell/stop limit is for, correct me if I'm wrong.
My questions:
1) After I purchase at the $1000 price, can this sell/stop limit setting be set right away, or should it be set after the market climbs past the $1500 mark, to work properly? What I am asking is, if I set the stop limit at $1500 while the market is still only at $1000, will it trigger a sell while it climbs up toward the $1500 sell/stop setting? I do not want it to do this because I want it to reach the $2000 sell limit if its climbing. Or does it not matter?
2) Am I correct in thinking that "buy"/stop limits work the same way as sell/stop limits, but in reverse? So if I wanted to buy when the market reached $500, I would set a buy/limit at $500 and a buy/stop limit at maybe around $700?
3) Sometimes I see the term sell/stop "loss". Is that just another term for sell/stop "limit"?
4) Now that I spent my only $1000 and have no funds left in my coinbase pro usd account, will I still be able to set all 4 settings? (- buy limit, - buy/stop limit, - sell limit, and - sell/stop limit)
Thank you for any help you can offer.
Well if I buy something for 500$ I put sell limit at 700$ and other limit at 300$ for example. I usually buy for hodl no trading... Watch some youtube video. DataDash has some old videos on setting the limits.
