One-Cancels-the-Other orders (OCO orders) can reduce risk in the volatile cryptocurrency markets traders can incorporate it into their trading strategy. It facilitates decision-making and the taking of positions, allowing traders to conserve their energy for studying the market.
There is an option to place OCO orders on Binance. Orders where “One Cancels the Other” refers to this. A limit sell and a stop-loss order are both very beneficial to you.
We advise you to study the articles regarding other order types, such as Take Profit Market Order, Stop Market Order, and Trailing Order, before reading this one if you are unfamiliar with them.
What Are OCO Orders?
Here is the OCO definition. What does oco mean in trading is as a pair of simultaneous Take Profit Market orders and Stop Market orders. One order automatically cancels the other once it is triggered. On both of the order types that you use with OCO, trailing can also be enabled.
OCO trading is a brand-new order type that Binance introduced. This is known as “One Cancels the Other.”
How Does OCO Work?
A pair of conditional orders make up an OCO order. It states that the other order will be automatically cancelled if one occurs. A purchase market order will be placed with a buy order if the price increases to or above your stop trigger price. A buy market order will be issued if the price falls to or below your take profit trigger price.
In trading words, they offered a method to set a stop limit to sell if the market drops or a way to sell at a higher price.
To do this, select OCO from the list by clicking on the arrow next to the OCO. More fields will be added; as a result, allowing you to enter your price and quantity.
Sections For OCO Order
There are two sections. One is Stop-Limit, while the other is Limit.
Consider Limit as a sale for profit and Stop-limit as an order to reduce losses in the event of a crash.
What Are The Advantages?
To navigate the volatile crypto market OCO is used, as they don’t need to verify charts to execute their position. It keeps the process clean and simple, which saves the necessary time and energy to analyse new trading opportunities.
How To Place An OCO Order?
- Select the market first and the crypto trading pair that you prefer.
- Select One Cancels the Other from the Advanced Options menu.
- Decide on the price of your Take Profit Trigger, Stop Loss Trigger, and the portion you want to spend. You can also enable trailing for both order types that you provide in OCO here.
- Once you’ve reviewed and confirmed your order, you’ll be able to see both of your orders.
How Are OCO Orders Used?
OCO orders are typically used by traders to trade breakouts and retracements. This is because breakout trading methods often employ the stop order, but reversal trading strategies typically use the limit order. OCO orders can be used by traders who seek to trade breakouts.
Let’s say, for illustration purposes, that the price moves above or below the support or resistance levels. At the right price points, traders can then set a buy-stop or sell-stop to enter or exit the market. Conversely, traders who trade retracements typically buy when the price declines and touches the support level and sell when the price rises but rebounds at the resistance level. Traders have the option to place an OCO transaction with a buy limit or a sell limit in certain circumstances.
A limit order and a stop-limit order with the same duration in effect are combined to form an OCO order. It states that the other order will be automatically cancelled if either one is executed. OCO orders assist traders in reducing risk, realising profits, and entering the bitcoin market. They are typical trading instruments utilised by seasoned traders. So, if you’re new to OCO orders, you can first practise trading on a free Demo account offered by brokerage platforms such as InvestBy, InvestFW and ABInvesting.