A stop order is a type of order that has a trigger price where a second order is executed.
When you place a Stop, you’re choosing the level you want to automatically close, open or add to a position.
Stops are usually used to control risk and limit loses. These types of stops are called “stop losses”, because they stop you from losing money.
There are 2 main reasons to use a stop loss:
- The first is to control and minimize losses *
- The second is to lock in profits
Stop losses control the maximum amount of money you can lose in any situation. They cut off losing trades before you’ve lost a substantial amount of money and exceeded your risk. They also stop you from losing any money you’ve gained in winning trades.
What’s the difference between a conditional and OCO stop order?
A stop order can either be Conditional or “One cancels the other” (OCO).
A conditional stop order has only a trigger and order price. An OCO order has two triggers and two potential orders. When one trigger is activated, it places and order and immediately cancels the other trigger.
Example: Buy with Stop - Limit
Bitcoin (BTC) is at $6,600 USD and the you think that if the price falls to $6,500 USD, it will keep falling. So, if you want to buy BTC at $6,450 USD when the price reaches $6,500 USD. Select Stop order, set the trigger price to $6,500 USD, and the order price as $6,450 USD with the amount of 10 BTC. When the BTC price reaches $6,500 USD or below, the condition of the trigger price is met, the order will be triggered. And the system will put the order to the market in the form of a limit order: the buy price is $6,450 USD, and the buy amount is 10 BTC.
| If your available balance is $1,000 USD at this time - because 1,000 USD is not enough to buy the order amount (10 BTC) - the system will put the limit order to the market with the amount that $1,000 USD can buy. If your available balance is $0 USD at this time, the order won’t be placed. |
Example: Sell with Stop - Limit
BTC is at $6,600 USD and you think that the price will go up if it can reach $6,800 USD. So, if you want to sell 10 BTC at $6,850 USD when the price reaches $6,800 USD. You can open a Stop-Limit order. When the price reaches $6,800 USD or above, the order will be triggered, and the system will put the order to the market in the form of a limit order with the sell price is $6,850 USD for 10 BTC.
If you only have 8 BTC at this time - which is lower than the order amount (10 BTC) - the system will automatically post an order of 8 BTC to the market. If your balance is 0.0001 BTC - which is smaller than the minimum trading amount 0.001 BTC - the order can’t be placed.
Example: Buy with Stop - Market
Assuming that the current BTC price is $13,900 USD, you want to buy BTC immediately at the market price when it reaches $7,000 USD, and the purchase amount is $14,000 USD. Select Stop Order, set the trigger price to $7,000 USD, and set the order price as the market price with the amount of $14,000 USD. When the BTC price reaches $7,000 USD or above, the condition of the trigger price is met, so the order is triggered. The system will put the order to the market in the form of a market order with the purchase price being the market price, and the purchase amount $14,000 USD.
| If your available balance is $10,000 USD, the system will put the market order to the market with the purchase amount of $10,000 USD as $10,000 USD is less than the order amount of $14,000 USD. If your available balance is $0 USD at this time, the order won’t be placed. |
Example: Case 2（Sell with Stop - Market）
Assuming that the current BTC price is $6,900 USD, the user wants to immediately sell BTC at the market price when the BTC price reaches $6,600 USD, and the sell amount is 4 BTC. As shown in the figure below: Select the order type "Stop Order", set the trigger price to $6,600 USD, and set the order price as the market price with the amount of 4 BTC. When the price of BTC reaches $6,600 USD or reaches below $6,600 USD, the condition of the trigger price is met, so the order is triggered, and the system will put the order to the market in the form of a market order: the sell price is the market price, and the sell amount is 4 BTC.
| If the user's available BTC balance is 2 BTC, the system will put the market order to the market with the sell amount of 2 BTC as 2 BTC is less than the order amount of 4 BTC; if the user's available balance is 0 BTC at this time, the order will not be placed. |
Getting started
To execute a stop order on OKCoin, go to to the trading section.
On the right hand side of the page, click on the order type bar. Select Stop Order in the drop down menu.
(Using Spot account as an example)
Placing an order
Choose the type of stop order - conditional and OCO.
For conditional orders, set the price you want to trigger the stop at. Then pick if you want to execute a limit or market order after the stop has been triggered.
For an OCO order, set the target price and stop trigger prices. Then set the order execution type and prices.