A limit order directs the exchange to trade coins for a price below the current ask or above the current bid, depending on whether they are buying or selling.
Bitcoin exchange platforms match buyers with sellers. Like a traditional stock exchange, traders can opt to buy and sell bitcoin by inputting either a market order or a limit order. When a market order is selected, the trader authorizes the exchange to trade the coins for the best available price in the online marketplace. A limit order directs the exchange to trade coins for a price below the current ask or above the current bid, depending on whether they are buying or selling.