About Lesson
Stop-limit orders are good tools for limiting the losses you may incur in a trade. This type of order allows you to set a stop price and a limit price. If BTC was trading at $10,000 and you set up a stop-limit order at a stop price of $9,900 and a limit price of $9,895. Then a limit order at $9,985 will be placed when the price dips by $10.
However, the order is only placed after the stop price is hit. You do still run the risk of the price not recovering, in which case you have no protection if it continues to dip below $9,985, and the order may not be filled.