What is a Limit Order?
How are Trader Joe Limit Orders Unique?
Types of Limit Orders: Place Orders and Pool Orders
Limit Order Strategies
What is a Limit Order?
A limit order is a type of trade that executes an automated buy or sell instruction for a token at a specific price. This is typically a type of trade used when the trader has a clear price in mind and is willing to wait for the market to reach that price.
How are Trader Joe's Limit Orders Unique?
Trader Joe is one of the first Decentralized Exchanges (DEXes) to implement fully on-chain 'maker style' limit orders.
What does 'Maker Style' mean?
Maker-style limit orders are orders that add liquidity to a Liquidity Book Pool. These orders are referred to as "maker" orders because they "make" liquidity by being available for takers to execute against. This type of limit order means that the Traders that set them, get a fee-free swap that will execute with no price impact.
On-chain 'maker style' Limit Orders provide the following key benefits:
No reliance on external oracles
Your trades have perfect execution
Complete decentralized ‘on-chain’ execution
Swaps with no additional fees to pay or price impact on your swap
Liquidity Book doesn't charge any fees on limit orders. Plus, there is no price impact or slippage on swaps when using the limit order feature making it a highly efficient option for trading.
Why won't my Limit Order execute?
For your limit order to complete, it must be fully filled. An order will only fill if there is an equal or greater trading volume corresponding to your order size. For instance, if you place an order to purchase $1k worth of tokens, there needs to be a seller swapping that amount of tokens at your specified price point, to fill your order.
Types of Limit Orders
There are two types of limit orders that open up new strategies and offer more flexibility and control for your trading and liquidity providing: Place Orders and Pool Orders. Both types of limit orders enable you to automate the execution of your swaps.
Place Orders are executed at your chosen specific price point. Your tokens are automatically deposited into a liquidity pool. If your price point is hit, your position will convert to your desired tokens and be held, waiting for you to claim them.
Setting up a Place Order
Head to the Trade page and select 'Place Order'
Set your target price and confirm the order
You can manage your order either by cancelling it or collecting your tokens once the Place Order completes.
Video Guide: Place Orders
Using the Pool Order feature, you can deposit liquidity across a specified range, such as $10 to $100. This is different to a Place Order, where you only specify a fixed price point for your order, such as $10. Using a Pool Order, your order is filled gradually as the price of the asset moves inside your range. Pool Orders are an excellent way to automate your Dollar-Cost Averaging (DCA) strategy, to enter or exit a token with no fees or price impact.
How to setup a Pool Order
Head to the Pool page and select a Liquidity Pool
Click the Order tab
Select the token you want to sell, eg you want to sell AVAX to buy USDC
Enter the token amount
Select a Liquidity Shape (You will likely want to select Spot for an even distribution)
Now define your price range that you will sell your token over eg $10 to $20
Click 'Add Limit Order' to confirm and place the order
Video Guide: Pool Orders
Limit Orders: Strategy Showcase
Use Limit Orders to automated advanced trading strategies:
Can I use Limit Orders for any tokens?
No, you can only place a limit order for a token that has an active Liquidity Book Pool. You can view all active Liquidity Book Pools by going to the Pool page and viewing the 'Main Pools' tab.
Why did my Limit Order not complete?
Your order will only fill when sufficient liquidity supplied from trading is available to match your specific order terms. The current market price may not be reflective of the actual price in the Liquidity Pool. A Limit Order will only complete, if the price in the Liquidity Pool hits your order and also, has enough liquidity to fill your order. Your order may not hit if for example you are placing a large order in a low liquidity pool.
Can I cancel an active Order?
Yes you can cancel an active order you will receive back your tokens at the time it is canceled. This might be partially filled at the time you cancel your order, in that case you will receive your order that is partially filled.
Can I get a refund?
No, your limit order if executed is permanent and cannot be refunded.
If you have any further questions please join the Trader Joe Discord