Conditional orders can be used to execute stop loss operations without creating any reverse positions.
Conditional orders consist of two parts: trigger conditions and execution orders.
Trigger conditions can be set based on the last price or mark price. Once the trigger condition is met, the system will execute a pre-set order.
Execution orders can be either limit orders or market orders, and you can set whether it is position-reducing only. When set to position-reducing only, the order becomes a closing order. By combining conditional orders with the position-reducing-only feature, users can effectively set up stop loss strategies for their positions.
Example:
Suppose you hold a 1 BTC long position at a price of 110,000 and wish to stop loss sell 1 BTC when the price drops to 108,000. In this case, you can set the trigger price to 108,000, the trade direction to sell, the order type to market order, and check the position-reducing-only option.
Normal situation:
When the price touches 108,000, the conditional order is triggered, and the system will close 1 BTC at market price, achieving the expected stop loss effect.
Situation where position size is lower than the closing amount:
If the price reaches 108,000 and your position has been reduced to only 0.5 BTC for some reason, although the conditional order is triggered, because you have selected the position-reducing-only feature, the system will automatically adjust the closing amount to the maximum closeable amount of 0.5 BTC. In this way, your 0.5 BTC can be successfully stopped out without creating a new position.