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I wondering what is the best order type for this situation: STOP MARKET or STOP LIMIT.

I am also using a software called Tradingview that allows one to get Alerts when Price reaches a certain level.

Scenario: Price of a stock is currently at a certain level (ex: $500) - but - there have been rumors that it could go down to $250. The rumor also says that the price would "go down and come back up quickly".

I wanted to do something like "stagger-buy" scenario at intervals of $50.

So, when the price starts going down, the following would happen:

At $450, create a STOP LIMIT order to STOP at $450 and to BUY shares at $460

At $400, create a STOP LIMIT order to STOP at $400 and to BUY shares at $410

etc.

My experience has been that if I use a LIMIT order alone, the BUY would happen immediately (because price is going down - quickly).

I did not want this. I wanted to buy the shares when the Price turns around and starts coming back up again.

Is this possible?

TIA

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A buy stop limit sets a maximum higher price for buying a stock. A sell stop order is the opposite, specifying the lowest price that one is willing to sell at. I'm unaware of such orders working in the opposite direction as you would like.

Some brokers offer Conditional Orders that allow multiple conditions to be included. For example, Fidelity or Interactive Brokers. You would have to explore the conditions allowed to see if this type of order would be a solution for you.

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  • Thanks for the response. My thoughts were to use Alerts generated from Tradingview. For example, once the Price crossed over a level (going down), then I would get an Alert. After receiving the Alert, would then open a STOP-LIMIT order ( using the same Price Level the alert was triggered from ).
    – Casey Harrils
    Commented Jul 13, 2021 at 1:41

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