What is an OCO order?
An OCO or “One Cancels the Other” order (one to cancel the other) allows you to place two orders at the same time. This order is a combination of two orders, a stop order and a stop-limit order, but only one of the two can be executed.
In other words, as soon as one of the two orders is partially or fully executed, the other is automatically cancelled. Note that if one of the two orders is cancelled, the other is also cancelled.
When trading on the Binance Exchange, you can use OCO orders as a basic form of automating transactions. This feature gives you the option to place two limit orders at the same time, which can help you to maximize your profit and reduce your loss.
How to use OCO order on Binance
After logging into your Binance account, go to the Basic Exchange interface and find the trading area as shown below. Click “Stop-Limit Order” to open the drop-down menu and select “OCO.”
On Binance, it is possible to place OCO orders as a pair of buy or sell orders. You can find more information about OCO orders by clicking on the question mark.
After selecting the OCO option, a new trading interface will be loaded, as shown below. This interface allows you to set a limit and a limit-stop order simultaneously.
- Price: The price of your limit order. This command will be displayed on the order book.
- Stop: The price at which your limit-stop order will be triggered (ex: 0.0024950 BTC).
Limit: Actual price of your limit order after the stop order is triggered (ex: 0.0024900 BTC).
- Amount: The size of your order (e.g. 5 BNB).
- Total: Total value of your order.
After placing an OCO order, you can scroll down to see the details of both orders under “Open Order”.
Example: You just bought 5 BNB at 0.0026837 BTC because you believe the price is close to the key support area and is likely to move up.
In this case, you can use the OCO feature to place a take profit order at 0.0030 BTC along with a stop-limit order at 0.0024900 BTC.
If your prediction is correct and the price rises to or above the 0.0030 BTC level, your sell order will be executed and the limit-stop order will be automatically cancelled.
Conversely, if your prediction is wrong and the price falls below 0.0024950 BTC, your limit-stop order will be triggered. This has the potential to minimize your losses, in case the price falls further.
Note: Stop Price is 0.0024950 (trigger price) and Limit Price is 0.0024900 (trade price of your order). This means that your limit-stop order will be activated at the time the price level 0.0024950 is reached. But, the actual trading price of your order will be 0.0024900. In other words, if BNB/BTC falls to 0.0024950 or below, a limit sell order at 0.0024900 will be placed.
The OCO feature is a simple yet powerful tool that allows you and other Binance users to trade in a more secure and flexible way. This particular order type can be useful for taking profits, limiting risk and even entering and exiting the market. However, it is important to have a clear understanding of limit and limit-stop orders before using an OCO order.
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