OCO Orders: Risk Management in the Crypto Market

OCO (One Cancels the Other) orders are an innovative feature for traders that allows for automated trading and risk management simultaneously. If you aim to improve the efficiency of your operations in the crypto market, this feature can become your competitive advantage. OCO combines two conditional orders into one system, where activating one automatically cancels the other – this changes the approach to portfolio management.

What is an OCO order and how does it simplify trading

Unlike regular orders, OCO orders are designed specifically for multitasking. The system allows you to set two possible outcomes at once: one for profit, the other for protection. When the market moves in one direction, the other order is instantly canceled. This means traders are always prepared for unpredictable market fluctuations without the need to constantly monitor charts.

The main advantage is that you only need margin for one asset, not for both orders simultaneously. This significantly reduces the capital involved and allows for more efficient capital allocation.

How it works: when one order cancels the other

An OCO order is set with two triggers—one at the upper limit, one at the lower, relative to the current price. When one trigger is activated, the corresponding order is executed, and the other order is immediately removed from the system. This ensures you are not overexposed or holding two conflicting positions.

There are two configuration types: buy and sell. For buying, the lower trigger (Take Profit) is set below the current price, and the upper (Stop Loss) above. For selling, the logic is reversed: the lower trigger is for stop-loss, the upper for take-profit. This flexibility allows covering all possible market scenarios.

Important to note: OCO orders only work with conditional market or conditional limit orders. For market orders, just set the trigger; for limit orders, both trigger price and execution price are required.

Practical scenarios: market entries and exits

Entry strategy: preparing for two possibilities

Imagine BTC is trading at $27,000. Resistance level is $30,000, support is $25,000. The trader wants to catch the entry point regardless of whether the price rebounds from support or breaks resistance.

Decision: set an OCO order with these parameters:

• Lower limit: conditional market buy order at $25,000 (Take Profit – buy at the bottom)
• Upper limit: conditional market buy order at $30,000 (Stop Loss – buy on breakout)

If the price drops to $25,000: the lower order triggers, buying at market price, the upper order is automatically canceled.

If the price rises to $30,000 without dropping**: the upper order triggers, buying at market price, the lower order is canceled. The trader captures both scenarios.

Exit strategy: profit or minimize losses

Trader B has 2 ETH bought at $1500 each. The current price is $1700. He expects it to rise to $2000 but wants to hedge against falling back to break-even ($1500).

Decision: set an OCO order to sell with these parameters:

• Upper limit: conditional market sell order at $2000 (Take Profit – lock in profit)
• Lower limit: conditional market sell order at $1500 (Stop Loss – preserve capital)

Profit scenario: price rises to $2000, the upper order executes, ETH is sold, the lower order is canceled. Profit is secured.

Protection scenario: price drops to $1500, the lower order executes, position closes at break-even, the upper order is removed. No losses incurred.

Limitations and features of conditional orders

It’s important to understand some key points when working with OCO orders:

No API access for users: if you use programmatic integrations, OCO orders are unavailable, as developers can create alternative strategies.

Only for spot and spot-margin trading: this feature is reserved for users not engaged in futures trading.

Limit orders require attention: if you set a conditional limit order, its trigger may activate, but the order itself might not fill if the market doesn’t reach the specified price. In this case, the other order will still be canceled—system treats the pair of orders as a single unit.

Margin is calculated once: margin is used only for one asset, not for both orders simultaneously—saving your capital.

How to view and manage your OCO orders

Tracking active OCO orders is straightforward. Go to the Open Orders tab—you will see all current positions. To view completed or canceled orders, check the Order History tab.

Additionally, detailed information is available via the Single Order page → Spot Orders → Current Orders, where you can fully track all parameters and statuses of your OCO orders. The extended history is also accessible for analyzing past operations.

OCO orders are not just a feature but a strategic tool for those serious about risk management and automation in crypto trading.