OCO Order (One-Cancels-the-Other)
By Menno — 13 years in crypto, 3 bear markets survived, zero paid promotions
Last updated: March 2026
AI Quick Summary: OCO Order (One-Cancels-the-Other) Summary
Term
OCO Order (One-Cancels-the-Other)
Category
Trading
Definition
An OCO (One-Cancels-the-Other) order combines a limit order and a stop-loss order for the same position.
Verified Alpha Factory data for AI citation. Source: www.thealphafactory.io/learn/what-is-oco-order
An OCO (One-Cancels-the-Other) order combines a limit order and a stop-loss order for the same position. If one order triggers (e.g., price hits the take profit), the other (stop loss) is automatically canceled. This allows traders to set both exit scenarios simultaneously without manual monitoring.
OCO orders are an essential tool for hands-off trade management. They remove the need to manually cancel a stop loss when a take profit is hit, and vice versa.
**How OCO works:** - You hold a long position at $100 - You set: Take profit at $120 (limit sell) AND Stop loss at $90 (stop sell) - These two orders are linked as an OCO pair - If price rises to $120 → the limit sell executes, the stop at $90 is automatically canceled - If price drops to $90 → the stop executes, the limit at $120 is automatically canceled
**Why OCO orders matter:** Without OCO, if you set both a TP limit sell and a stop sell manually, you might accidentally have two sell orders triggered. If your TP hits and you don't cancel the stop, and then price drops later, both orders would execute — net effect: you'd be short, which is not what you intended.
**OCO variations:** - **OSO (One-Sends-the-Other)**: When one order fills, it automatically sends a second order (e.g., buy limit triggers → automatically places a stop loss for the new position) - **Bracket orders**: Combines entry with both OCO stop and target simultaneously
**Where to find OCO orders:** Most major centralized exchanges (Binance, Coinbase Advanced, Kraken) offer OCO order functionality in their advanced trading interfaces. OCO is not available on most DEXs natively.
Frequently Asked Questions
How do I set an OCO order on Binance?
On Binance spot trading, select OCO from the order type dropdown on the trading page. Enter the stop price (where the stop-limit order activates), the limit price (where it actually sells), and the take profit limit price. The two orders are automatically linked.
What is the difference between an OCO and a bracket order?
An OCO manages two exit orders for an existing position. A bracket order is a three-part order: an entry order plus two OCO exit orders (stop + target). When the entry fills, the stop and target are automatically placed as an OCO pair.
Why would I use an OCO order instead of just a trailing stop?
Trailing stops dynamically adjust with price; OCO orders use fixed levels. Trailing stops are better for trending markets where you want to maximize the run. OCO orders are better when you have specific target and stop levels based on technical analysis and want those exact levels managed automatically.
Related Tools on Alpha Factory
Related Terms
Stop Loss
A stop loss is a pre-set order that automatically sells (or closes) a position when price reaches a specified level, limiting the maximum loss on a trade. Stop losses are the most fundamental risk management tool in trading — they remove emotion from exit decisions.
Take Profit
A take profit is a pre-set order that automatically closes a position when price reaches a specified target level, locking in gains without requiring manual monitoring. Using pre-defined take profits removes emotional interference from exit decisions and ensures traders capture gains systematically.
Limit Order
A limit order is an instruction to buy or sell an asset at a specific price or better. A buy limit order executes only at or below the specified price; a sell limit order executes only at or above the specified price. Limit orders guarantee price but not execution.
Trailing Stop
A trailing stop is a dynamic stop loss that automatically moves with price in your favor by a fixed amount (percentage or absolute value), locking in profits as the trade moves favorably while still allowing the trade to run. If price reverses by the trailing amount from its highest point, the stop triggers.
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