Topic: Last price and mark price in taking profit (Read 83 times)

I also use limit order on Binance until I prefer to trade on Bybit. I have forgotten how it is on Binance but if you use TP/SL on bybit, you will  nit see limit or market order. But there is another one called close by, you will be able to set the limit order there. I did it just right now and the order filled at the expected price. But the market was not that volatile at the time for me to draw a perfect conclusion. I will continue to use it instead of TP/SL.



Do not just make conclusion. See my explanation above. When I click on set TP/SL, this is what you will see:




If you click on last, you will see this (I set mine as mark and I click on mark):




There is no where to set the limit order unless you go for close by. Even though I did not use the limit order but I set the the TP as mark, the trade filled at the mark price which is the expected price that I need. So how am I not good in trading?

Only what can be used to make conclusion if a trader is good is when he has profit than loss.

This show me as a bad trader?



In short, the mark price still do what I wanted. Also the limit order.

Your use of the Market price order in futures trading indicates that you do not know much about trading. It is best to use the spot market, where there is no margin to lose, and then use the limit order instead of the Market price order, since the market order means that you want to sell now at any price and it is for those who achieve it. Profits, for example, when the price of Bitcoin rises sharply and any amount above $50,000 is profitable and you fear that with a major correction the price will drop from $60,000 to $50,000 quickly. Here, the market order will lead you to sell in an area above $50,000 instead of limit order which may not be executed.
So Market order has limited use cases and often does not lead to good profits.

Yup I always set limit orders. And then set it to account for fees. I use Binance and pay also in BNB so it's a very low fee and usually I sell in satoshi amount so it's slightly easier to count in 100s of satoshi (now 100 is 65 cents). But it always shows the total amount less fees anyway so it's easier to set limit orders and let them fill.

You should use Limit order, not Market price order.

With market price order, you will have uncertain volatile exit price because it depends on the market, buy and sell orders. Must know that buy and sell orders are manipulated by trading bots too and those orders and order prices can be changed very quickly. If you are lucky, you will not have big difference when closing your position but if you are unlucky, the actual exit price will be considerable worse than your expected price.

Some traders including myself have blamed exchanges that instead we should make profit, that the PnL is loss for us after closing a position. I noticed what is causing it recently apart from trading fee.

We know that trading fee can cause it. But after the fee is deducted, you will still know that you are losing. The last price and the market price should be what you should know their differences. Not their definition or meaning, but how exchanges use them if you set take profit.

TP= take profit.

On exchanges, you will notice that there are two prices of a coin like in this image:



The price above is the last price which is 5.679
The price below is the mark price which is 5.577

The market is not that volatile when I took that picture. If the market is volatile, you can even see the mark price price much lower than that if compared with the last price.

If you set take profit at $5.679 and you use last price to set the TP order, the TP will be filled at $5.577 which is the mark price and which will make you not to earn the profit that you supposed to earn. But if you change the TP order to mark price, the order will be filled when the mark price get to $5.679.

How to set it to mark price depends on the exchange that you are using but you will ṣe it when you want to set the TP after you have opened a position.