What Are Active Sell / Buy Orders And How Do They Work?
An order in the meaning of the crypto community is an order to sell or buy a cryptocurrency. A sell order is made at the declared price or higher, respectively, a buy order — at the declared price or lower. When selling, the trader expects to make money; when buying, it is more profitable to sell later, when the price rises.
What Is An Active Order?
An active order is an order to buy or sell a cryptocurrency that has already been created but has not yet been executed. In order to create an order, you need to transfer funds for its implementation. After that, the order becomes active, and the funds from your account will be put into reserve.
An active order can be executed immediately or over a period of time. Sometimes this can happen very quickly if there is a counter offer in the order book that matches the buy or sell price you declared. Sometimes it takes longer if an order that matches your conditions is not found. Also, the order can be executed in parts, and then the funds from your account will also be debited in parts.
The system processes orders automatically. An active but unfulfilled order does not imply a withdrawal of funds from your account. In the «Finance» section you can see this by looking at the «Reserve» column, where there will be the amount transferred by you, but not yet debited from your account. This works in a similar way to the banking system, when you transfer funds to the destination and wait for the issuing bank to process the application. Only in the case of a bank account, you will not see this stage of the movement of funds — you will simply see that the specified amount has been debited from your account, and in fact it will be debited when it is credited to the addressee's account.
What Can You Do With Active Orders?
An active order can be canceled by clicking on the corresponding option in the «Active Orders» section of the menu, which is located under the order book. You can cancel even a partially filled order, but in this case, only the part of the funds that was not spent on the executed part of the order will be returned from the reserve.
When Does It Make Sense To Cancel An Active Order?
If your order remains active for a long time, it is possible that your proposed buy/sell price is not relevant to the current market conditions. In this case, it makes sense to cancel the active order and create another one by carefully studying the charts or wait and do it in a more favorable situation, depending on your trading strategy.