OCO (One Cancels the Other) is an order type that combines two orders: Take Profit (profit fixation) and Stop-Loss (loss limitation). When one of them is triggered, the other is automatically canceled.
This tool is great for those who want to define their trading goals in advance and avoid unnecessary risk.
Why OCO orders are needed
1. Trade automation. You don’t need to constantly monitor the market.
2. Risk control. You know in advance how much you are willing to lose or earn.
3. Convenience of management. One tool solves two tasks: securing profit and limiting losses.
Example of using OCO orders (price is current at the time of writing)
Let's imagine that you bought 1 BTC at a price of 99,440 USDT. You want:
fix profit at the level of 105,000 USDT;
limit the loss if the price falls to 95,000 USDT.
How to set up OCO orders on Binance
1. Open a trade
Let's say you bought 1 BTC at 99,440 USDT.
2. Set an OCO order
Go to the "Close Position" section.
Select the "TP/SL" tab.
3. Fill in the fields
In Take Profit, specify the profit level: 105,000 USDT.
In Stop Loss, specify the loss level: 95,000 USDT.
4. Confirm the order
Check the data and click "Confirm".
Now your trade is protected:
if the price reaches 105,000 USDT, the position will close with a profit;
if the price falls to 95,000 USDT, the loss will be limited.
Example calculation
Opening a trade: buying 1 BTC at 99,440 USDT.
Take Profit: 105,000 USDT (profit 5,560 USDT).
Stop Loss: 95,000 USDT (loss 4,440 USDT).
Recommendation:
1. Analyze the market. Set Take Profit and Stop Loss levels based on charts, support, and resistance levels.
2. Consider volatility. Set Stop Loss with a margin to avoid accidental triggering.
3. Calculate risks. Determine how many percent of the deposit you are willing to lose and adjust orders within these limits.
OCO orders are a great tool for those who want to keep their nerves and clearly follow a strategy.
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