Post-only orders

Post-Only Orders: A Beginner's Guide

Welcome to the world of cryptocurrency trading! This guide will explain a powerful, yet often overlooked, order type called a "post-only order." It's a tool that can save you money on trading fees and improve your trading strategy. Don't worry if you're a complete beginner – we’ll break everything down step-by-step.

What are Post-Only Orders?

Imagine you're at a marketplace. A "market order" is like shouting, "I'll buy whatever price everyone's selling at right now!" A "limit order" is like saying, "I'll only buy if the price drops to $X." A post-only order is a *special type* of limit order.

Essentially, a post-only order tells the cryptocurrency exchange that you *only* want your order to be placed as a maker order. Let’s unpack that.

• **Maker Orders:** When you place a maker order, you're adding liquidity to the market. You're placing an order that isn’t immediately filled, but sits on the order book waiting for someone else to take it. Think of it like posting a 'bid' or 'ask' price.
• **Taker Orders:** When you place a taker order, you’re taking liquidity *from* the market. You’re immediately filling an existing order on the order book.

Post-only orders *force* your order to be a maker order. If your order would normally be executed as a taker order (meaning it would instantly match with an existing order), the exchange will *reject* it.

Why Use Post-Only Orders?

The primary benefit of post-only orders is reduced trading fees. Most exchanges offer lower fees for maker orders than for taker orders. This is because makers contribute to the liquidity of the exchange, which is beneficial for everyone.

Here's a simple example:

Let's say the fee for a taker order is 0.1%, and the fee for a maker order is 0.05%.

• You buy $1000 worth of Bitcoin with a taker order: You pay $1 in fees ($1000 * 0.001).
• You buy $1000 worth of Bitcoin with a post-only order (and it's filled as a maker order): You pay $0.50 in fees ($1000 * 0.0005).

Over time, these savings can add up significantly, especially if you trade frequently. Register now

How Do Post-Only Orders Work in Practice?

Most major exchanges – like Binance, Bybit, BingX, BitMEX, and others – offer post-only order options. However, the specific way you set them up varies. Here's a general guide:

1. **Access the Order Form:** Go to the trading interface for the cryptocurrency pair you want to trade. 2. **Select "Limit" Order:** You’ll typically start by selecting the "Limit" order type. 3. **Enable "Post Only":** Look for a checkbox or setting labeled "Post Only," "Maker Only," or similar. Enable this option. 4. **Set Your Price:** Enter the price you want to buy or sell at. Remember, this is a limit order, so your order will only be filled at your specified price or better. 5. **Enter Quantity:** Specify the amount of cryptocurrency you want to trade. 6. **Review and Submit:** Double-check your order details and submit it.

• • Important Considerations:**

• **Price Slippage:** Because post-only orders are limit orders, they aren't guaranteed to fill immediately. If the price moves away from your specified price, your order might not be filled at all. Understanding price slippage is crucial.
• **Order Book Depth:** The deeper the order book (meaning there are many buy and sell orders at different price levels), the more likely your post-only order will be filled.
• **Time in Force:** You may need to select a "Time in Force" option (like "Good Till Cancelled" or "Fill or Kill") to determine how long your order remains active.

Post-Only vs. Regular Limit Orders

Here's a quick comparison:

Feature	Post-Only Order	Regular Limit Order
Order Type	Maker Order Only	Can be Maker or Taker
Fee Structure	Lower Maker Fees	Potentially Higher Taker Fees
Execution	Guaranteed Maker Execution (if possible)	Can Execute as Maker or Taker
Fill Speed	Generally Slower	Can be Faster

Advanced Post-Only Strategies

• **Iceberg Orders:** Combine post-only orders with iceberg orders to hide your trading volume and avoid impacting the market price.
• **Dollar-Cost Averaging (DCA):** Use post-only orders to execute DCA strategies with lower fees. Dollar-cost averaging involves buying a fixed amount of an asset at regular intervals.
• **Range Trading:** Place post-only buy and sell orders at different price levels within a trading range to profit from price fluctuations. See range trading for more information.
• **Using with Technical Analysis:** Combine post-only orders with signals from technical indicators like moving averages or RSI.

Exchanges and Post-Only Orders

Here's a quick overview of how some popular exchanges handle post-only orders:

Exchange	Post-Only Availability	Notes
Binance	Yes, in Futures and Spot	Clear "Post Only" checkbox in the order form. Register now
Bybit	Yes, in Futures and Spot	"Maker" option available in the order type selection. Start trading
BingX	Yes, in Spot and Futures	Requires enabling "Maker Only" in advanced order settings. Join BingX
BitMEX	Yes	"Post Only" checkbox available. BitMEX
Kraken	Yes	"Post Trade" option available.

Risks and Considerations

• **Unfilled Orders:** Your order may not be filled if the market doesn't reach your specified price.
• **Opportunity Cost:** While waiting for your order to be filled, you might miss out on other trading opportunities.
• **Complexity:** Post-only orders add a layer of complexity to your trading strategy.

Resources for Further Learning

• Order Book
• Trading Fees
• Limit Order
• Market Order
• Technical Analysis
• Trading Volume
• Candlestick Patterns
• Moving Averages
• Risk Management
• Liquidity
• Scalping
• Swing Trading
• Day Trading
• Arbitrage Trading
• Fundamental Analysis

Conclusion

Post-only orders are a valuable tool for any cryptocurrency trader looking to reduce fees and potentially improve their execution. While they require a bit more understanding and planning, the benefits can be significant. Practice using them on a demo account before risking real capital. Remember to always prioritize risk management and continue learning about the ever-evolving world of cryptocurrency trading. Open account

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BingX Futures	Copy trading	Join BingX - A lot of bonuses for registration on this exchange

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