What is an OSO Order and how it Works?

Have you ever noticed that a big move in one cryptocurrency suddenly triggers a move in other cryptocurrencies? Sure, we’ll have seen that! Isn’t it true? if Bitcoin makes a move then Bitcoin cash and Litecoin also follow the same suit and make a big move.

After watching such a big initial move, sometimes it becomes difficult and impossible to manually enter an order in other cryptocurrencies so as to catch that move. And, here comes the role of automated moves and improve trading. With the best crypto trading platforms like Growlonix, traders can build an algorithm to place their trades automatically.

There are different order types that traders can use to buy or sell cryptocurrencies to open or close a position. One such kind of order is conditional order which allows users to instruct the system to open or close a position at a preset trigger price. Some of the popular conditional orders types are OCO order, OSO order, etc.

Let’s understand, what are conditional orders first?

Conditional order

We all know about the instability of the crypto trading market. None of us know where the market will move in the future. Sometimes, it seems the possibility of a bearish and bullish market direction is equivalent.

In such scenario, what should a trader do?

Staying without doing anything or leaving it on the future market condition is not a good idea. Isn’t it?

In this scenario, considering conditional orders like OSO (Order Sends Order) is the best option.

A conditional order is an order which include one or more predefined or set criteria. Generally, these orders refer to more complex order types used in advanced crypto trading strategies.

One of the most common types of conditional order is a limit order, which usually specifies a fixed price above or below which a buy or sell cannot take place. Although, there are some other conditions which can exist in these order types aside from price. Such conditions may include how long an order is enforced, or if another order must be completed first before a new order is triggered.

These orders are executed or activated in the market if any specified criteria are met. Limit, stop, contingent orders, and stop-limit orders are all examples of conditional orders. Often traders use

Let’s understand it with an example:

After a huge price fall in market, the price for Bitcoin, BTC has stabilized at around $6,800 now. Mr. Joe believes that the market panic has been improved now and it will be alleviated soon.

He plans to enter the market when BTC rebounds further and stands firm. He finds $7,200 a signal of price breakout. However, Mr. Joe is now worried about not getting timely updates on the market moves due to her recent busy schedule. What can he do to time the trade?

In this scenario, Mr. Joe is advised to use a conditional order.

He preset a limit order to buy 10,000 BTCUSD contract at $7100, but it’s only triggered when the price rises to $7200.

One can place market or limit order when the preset condition is triggered.

Market order: Once triggered, the preset buy or sell orders will be executed as market orders.

Limit order: Once triggered, buy or sell orders with preset price and quantity will be executed as limit orders.

Common application of conditional order

Traders often use conditional orders for stop loss, Trailing stop loss, stop sell, and various breakout strategies.

OSO/OCO

OSO (Order Sends Order)/OCO (Order Cancels Order) are the most popular conditional orders that can be placed from the popular crypto trading platforms. One can also place OCO and OSO on Binance.

OCO Order

This order consists of a group of two or more parallel orders which are linked together in such a manner that if one order is fulfilled, then other order is cancelled.

Example:

Let’s say an OCO order consists of two orders, i.e. a limit order to buy 500 coins of one crypto asset, and a stop order to sell 200 coins for other crypto asset.

If the limit price of one order hits and fills, the stop order will be canceled automatically.

OSO Order-The core concept

This order consists of a primary order that will send one or more secondary orders when the primary order is filled.

An OSO order is a set of conditional orders specifying that if one order executes, then the other orders are entered automatically.

Experienced traders use this type of order to mitigate risks and to lock in gains. An OSO order is the opposite of OCO order.

Key takeaways about OSO order

An order-sends-order (OSO) is a type of conditional order where the execution of a primary order triggers the position of one or more secondary orders.
These orders can be used to mitigate losses and lock in profits on a new position.
An OSO is just an opposite of an OCO, in which execution of a primary order cancels one or more other orders.

In OSO order, a trader enters a limit order to purchase a particular coin, say BTC. If this primary order is executed, it will trigger one or more secondary limit orders to buy other coin say ETH. This OSO also may include the placement of sell limit orders or sell stop orders on one or more of these crypto assets, as in the bracketed buy order.

One-Sends-the Order is a conditional order that is executed upon the immediate execution of the primary order. OSO on Binance and other crypto trading platforms traditionally use a bracket strategy.

A bracket is an order strategy that is designed to help limit a loss and help lock in a profit by attaching or joining an order with two opposite-side orders using the same quantity as the original order.

Example:

There is an OSO order consisting of three orders, where the primary order 1) is a limit order to buy 1000 coins of a crypto asset, X and attached to it are two other orders: 2) a limit order to buy 500 coins of another crypto asset, and 3) a stop order for 1000 coins of the crypto asset X at a specified price below the limit price for that order. When the primary order is filled, the two additional OSO orders are sent: one that buys additional coins of that particular crypto asset, and another that sets a stop loss for crypto asset X.

In this article, we will discuss about OSO orders in deep:

Another example:

There is an OSO order consisting of two orders. The primary order is a

1.) Trailing Stop Buy order to buy 100 coins for BTC, and attached to it is a secondary order.

2) Trailing Stop Sell order. When the primary order is filled, the secondary order is placed, one buys the coin when the market is at Dip and another sells the coin when the market is at Peak.

Placing an OSO order

Steps to place an OSO order:

Select the type of OSO from dropdown: Example Trailing Stop Buy + Trailing Stop Sell.
Select Market Pair: Example BTC/ADA
Offset1: The first offset is to specify Trailing Offset for Sell Order. Example 8%
Offset2: The second offset is to specify Trailing Offset for Buy Order. Example 5%
Total: Amount of Base coin to trade. Example 0.5 BTC
Repeat: If repeat is enabled. It will repeat the entire order once the first set of the sequence is finished. Example: if repeat value is set to 1 then once the first cycle is finished (Trailing Buy + Trailing Sell) another cycle will start with the same order parameters. Setting it to 2 will repeat the cycle 2 times after the first cycle ends. Making it a total of 3 cycles. By default, it is set to false.

Important point to be noted:

Use this feature with care. OSO Orders are a combination of Trailing orders. And Offset value set in Trailing Order depends on users’ discretion and may fail to predict market behavior thereby causing losses.

Custom OSO

Growlonix is one of the most popular crypto trading terminal allowing traders to place custom OSO order. This allows you to group conditional orders using your own combination of existing order types. When the first order is filled, the next order gets executed.

One may access this order type using the ORDER DROPDOWN options from Order form. Here you can select OSO – CUSTOM Order. The Custom OSO Order form is displayed with two more dropdowns to configure Primary Order and Secondary Order.

Let’s understand it, how:

Here we will take example of a bracket order comprising of stop buy order and OCO order:

Primary Order: From the Primary order dropdown select Stop Buy Order. Configure order parameters as you would do in any Normal Stop Buy Order.

(Optional)
Trigger: Primary order can also be configured to be executed based on Email or Telegram Signal.

Once the primary order is configured, click on the next button to start configuring secondary order.

Secondary Order: From Secondary Order dropdown options select OCO order.

Configure the OCO order parameters as you would do in any normal OCO order.

Note: Since Secondary Order is in series of Primary Order and becomes active once primary order is filled so Trigger settings are not available for Secondary Order.

Reset:

Clicking on reset will empty all the fields and bring forms in the initial state.

Here in the below example, you can see in the Open Orders list, the system has placed 3 orders.

One order is to buy the coin pair and other 2 orders as part of the OCO to take profit and protect loss.

Since OCO is in series of Stop Buy order. So if you look at status of Order then Stop buy is Open and other two are in the pending state waiting for Stop Buy to get it filled.

In case you have opted for the trigger option then all the orders will be initially in the pending state waiting for the signal to open the primary order which once filled will trigger the secondary order.

First column in order table denotes order group ID and can be used to identify order belonging to same OSO group in a large list of orders.

Crypto trading bot Binance automates the OSO trading for the traders and lets them relax after setting the bot strategy.

Cancel Order: If a trader cancels any order belonging to an OSO group then all the attached order of that group also gets deleted.

Recommended Order Combinations:

Stop Buy + Trailing Stop Sell
Market Buy + OCO (With Trigger)
Stop Buy + Take Profit
Stop Buy + Stop Loss
Stop Buy + OCO

OSO on Binance

Combine any two supported order types to execute one after the other in series without your intervention.

Popular use cases include:

Create the perfect trade strategy that you can set and forget.
Stop Buy + OCO sell (multi take profit targets plus stop loss)
Ladder into a trade using a custom DCA order
Multiple Stop Buys, 1 target + stop-loss that dynamically adjust volume based on triggered buys
Trailing stop buy + OCO sell
Hunt those dip whilst you sleep

Order combinations which are not recommended
Limit buy + OCO
Limit buy +Trailing stop sell

You can simply replace Limit Buy orders with stop buy market.

Bracket orders for long and short position

Custom OSO orders are available for both long and short trades in cryptocurrency:

To create a long trade bracket order, use custom OSO option to create a buy order as primary and OCO sell as secondary.
To create a short trade, combine any sell side order in primary position with any of the buy side order in the secondary position.

Opening a short or long position in Binance

To open a short position or close a long position in Binance Futures following order types can be used:

Limit Sell
Market Sell
Stop-Loss (Where stop price is less than the current price)
Take profit (Where stop price is greater than the current price)
Trailing Stop Sell
Take profit with Trailing exit
OSO (Bracket Order) with any of the above order as Primary/Secondary Order
OCO (One Cancel Other) with any of the above order as Primary/Secondary Order

To open a long position or to close a short position in Binance Futures following order types can be used:

Limit Buy
Market Buy
Trailing Stop Buy
Stop Buy – Price Greater than the current price
Stop Buy – Price Less than the current price
Stop Buy with Trailing Exit
OSO (One Send Other) with any of the above order as Primary/Secondary Order
OCO (One Cancel Other) with any of the above order as Primary/Secondary Order

Conclusion

Conditional orders are one of the most advanced trading orders in cryptocurrency that is not present in all exchanges. But you can find them on Binance. This type of order automatically confirms or deletes orders when it meets a certain criteria.

OSO orders are the most popular and advanced order types which a trader can use through multiple exchange platforms. Growlonix is one of the best crypto trading terminals that let its traders place all types of conditional orders on Binance and other exchanges.

OSO feature is a simple yet powerful tool which allows Growlonix traders to trade in the most safer and versatile way. It allows the traders to set trades automatically via crypto trading bot Binance and on other exchanges to place orders on your behalf without watching the market. Deep understanding of the market and trading methods is a must to place OSO order smartly.