1. What are Take Profit (TP) and Stop Loss (SL)?

1. TP/SL Order:

TP/SL order is an algorithmic trading strategy with which traders may set a trigger price and an order price to limit losses and reduce risks. Orders will be placed automatically at the predefined order price once the Mark price reaches the predefined trigger price to "take profit" or "stop loss". With this strategy, traders may engage in momentum trading or limit their losses in a volatile market.

2. Placing an order with TP/SL Order:

When placing a Limit Order, Market Order, or Post Only, you can set up a TP/SL order for the position to be opened. When the limit order is fully filled, the TP/SL order will be placed automatically with the predefined trigger price and order price.

3. Position TP/SL Order:

A position TP/SL order refers to a TP/SL order specifically placed for a certain position. Currently, you may use market price to set TP/SL in a position.

You can check and cancel the TP/SL orders in the "Open Orders".

2. How to Place Take Profit (TP) and Stop Loss (SL) Orders?

Scenario 1 (Close a long position with a conditional order):

A user holds a long ETH contract with an average open price of 2,000 USD and expects to close the long position to stop losses when the market price drops to 1,800 USD. He/she places a conditional order as shown below.

Trigger Price: $1,800

Order Price: $1,750 (When selling out, it is preferable to set the order price not too close to the trigger price to ensure the order will be filled promptly. Choosing the market price is also recommended.)

If the price falls to $1,800, the stop-loss order shall be triggered, and the user's long position will be closed at $1,750. If the order price is set as the market price, the position will be closed at the market price immediately.

If the user wishes to close his/her long position and lock in his/her gains, he/she can set up a take-profit order and set the trigger price somewhere higher than $2,000.

Scenario 2 (Close a short position with a conditional order):

A user holds a short ETH contract with an average open price of $2,000 and expects to close the short position to stop losses when the market price rises to $2,200. He/she places a conditional order as shown below.

Trigger Price: $2,200

Order Price: $2,250 (When buying in, it is preferable to set the order price higher than the trigger price to ensure the order will be filled promptly. Choosing the market price is also recommended.)

If the market price goes up to $2,200, the stop-loss order will be triggered and the user's short position will be closed at $2,250. If the order price is set as the market price, the position will be closed at the market price immediately.

If the user wishes to close his/her short position and lock in his/her gains, he/she can set up a take-profit order and set the trigger price somewhere lower than $2,000.

Scenario 3 (Close a long position with TP/SL orders):

A user holds a long ETH contract with an average open price of $2,000. He/she expects to take profits when the market price surges to $2,200 and to stop losses when the market price drops to $1,800. The user places TP/SL orders as shown below.

TP Trigger Price: $2,200

TP Order Price: Market price or any price, e.g., $2,150

SL Trigger Price: $1,800

SL Order Price: Market price or any price, e.g., $1,750

TP will be triggered if ETH's market price goes up to $2,200 USD and the user can exit the trade at the market price instantly or at the preset TP order price, for example, $2,150.

SL will be triggered if ETH's market price drops to $1,800 and the user can exit the trade at the market price instantly or at the preset SL order price, for example, $1,750.

Scenario 4 (Close a short position with TP/SL orders):

A user holds a short ETH contract with an average open price of $2,000. He/she expects to take profits when the market price drops to $1,800 and to stop losses when the market price surges to $2,200. The user places TP/SL orders as shown below.

TP Trigger Price: $1,800

TP Order Price: Market price or any price, e.g., $1,850

SL Trigger Price: $2,200

SL Order Price: Market price or any price, e.g., $2,250

TP will be triggered if ETH's market price drops to $1,800 USD and the user can exit the trade at the market price instantly or at the preset TP price, for example, $1,850.

SL will be triggered if ETH's market price rises to $2,200 and the user can exit the trade at the market price instantly or at the preset SL order price, for example, $2,250.

Scenario 5 (Open a long position with a conditional order):

ETH's current market price is at $2,000 USD and the user believes that the market will turn bullish if ETH's market price pushes through the $2,200 mark. He/she places a conditional order as shown below.

Trigger Price: $2,200

Order Price: Market price or any price, e.g., $2,250

If ETH's price goes up to $2,200, a long order will be triggered and placed at its market price or the preset order price, for example, $2,250.

TP/SL orders can also be placed for opening a long position. A bullish action will be triggered at the higher price while a reverse order will be triggered at the lower price.

Scenario 6 (Open a short position with a conditional order):

ETH's current market price is at $2,000 and the user believes the market will turn bearish if ETH's market price falls through the $1,800 mark. He/she places a conditional order as shown below.

Trigger Price: $1,800

Order Price: Market price or any price, e.g., $1,750

If ETH's price drops to $1,800, a short order will be triggered and placed at its market price or the preset order price, for example, $1,750.

TP/SL orders can also be placed for opening a short position. A bearish action will be triggered at the lower price while a reverse order will be triggered at the higher price.

3. TP/SL Order Settings and Trigger Rules