An OCO (One Cancels the Other) order allows you to place two orders at the same time. It combines a limit order with a stop-limit order but only one of them can be executed. This means that as soon as one of the orders is partially or fully filled, the other is automatically canceled. Manually canceling one of the orders will also cancel the other one.

When trading on Binance, you can use OCO orders as a basic form of trade automation. This feature allows you to place two limit orders at the same time, which can minimize potential losses. However, the use of OCO orders may vary slightly, depending on the specific exchange used.

For instance, you may have bought 5 ETH for 0.34 BTC due to speculation that ether will likely increase in value against bitcoin. You can then use OCO orders to minimize losses should your prediction be incorrect, or take profits if the outcome is in your favor.

To do this, you could place a profit-taking order at 0.4 BTC, along with a stop-limit order at 0.3 BTC. If the price rises to 0.4 BTC, your sell order will be executed and the stop-limit order will be canceled automatically. Conversely, if the price drops to 0.3 BTC, the stop-limit order will be executed and your profit-taking order will be canceled.

The sell order will only be placed if the trigger price is reached or exceeded, which in this case is 0.34 BTC. So, if the price of ETH/BTC drops to or below 0.34 BTC, a sell order will be placed at 0.3 BTC.

The OCO feature allows traders to work in a safer and more versatile way by automating the aforementioned tasks, so they can lock in profits and minimize risk. Do note that while this is a simple tool, using it effectively requires a good understanding of limit and stop-limit orders.