Quote from: zhoutong on February 21, 2012, 11:38:40 PM

Quote from: twa on February 21, 2012, 10:47:18 PM

Quote from: RandyMarsh on February 21, 2012, 11:40:41 AM

There is no incorrect way to use the orders, if you set a limit buy above the market price, then bitcoinica says to itsself 'oh shit guys we're already below that price... execute now'. if you set a stop buy (weather or not you have a position open) below the market price then bitcoinica says to itsself 'oh shit we're already above that price... execute now'.

I think there may be a fundamental misunderstanding of how the orders work,
Basically:

Limit: makes you money by executing your order when the price reaches a point in the profit direction.

Stop: cuts your losses by executing your order when the price reaches a point in the loss direction.

trailing stop: cuts your losses by a set amount(of loss), rather then at a set price.

And any of these orders can be used to open, close, increase or partially close a position.

I get the definitions of them and what they are used for but what I am confused with now is why I could use a stop order to create a new position. Why is that possible?

For example, you want to buy Bitcoins *only* when it rises above $4.5. Then you can set a stop buy order at 4.5.

In Bitcoinica, orders and positions are not linked at all. If there's any position, the system will always add/subtract from it. If there's no position, the system will create one. Whenever a position becomes zero, the P/L will be realized and it will be removed.

Hey thanks Zhoutong for confirming that.