There are many different type's on eyeliner so i thought i'd go through them and talk about which i use for what.
1) Liquid Liner
This is probably the hardest to use and apply but if you are already good at applying your eyeliner this does give a very elegant sleek look. Especially good for winged eyeliner! I wouldn't advice using it for your water line as it doesn't stay very well. If it's the only eyeliner you have and you wan't to use it on your water line then I would use a eye shadow the same colour as your eyeliner on top to set it.
2) Pencil/Kohl liner
This is the basic eyeliner. It can be used for your lash line, water line of your upper water line. It is a staple item that everyone must have but i prefer having a white pencil liner, for my water line and inner corner, to make my eyes look bigger and more awake! I personally use gel eyeliner in my water line (which i'll talk about in a minute) but pencil eyeliners work very well as well. I tend to have all my different coloured eyeliners in pencil form. For example brown, blue and white.
3) Gel Eyeliner
These 99% of the time come in a little pot so you will have to purchase your own brush to use it. Which on one hand is good because you get the type of brush you really want, but it does add more to the money you have to spend! Gel eyeliner is my personal favorite, because it gets the look of liquid but it's a lot easier to apply! It stays on very well and can but used on your water line. It used to only be brands like MAC that did gel eyeliner pots but a lot of drugstore brands are bringing them in now. Which is great for the price! I know Mabelline do a gel eyeliner and brush together for less than just the pot costs at MAC!
Hope I've helped you decide which eyeliner is best for you!