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▶ Introduction to Reduce-only Orders

Support Staff
  • Updated

  • What is reduce-only?

Reduce-only orders can only close your positions. Reduce-only is only available when there are active open trade positions. . Here are some scenarios:

  • The order size of a Reduce-only order should be less than the current position. If the size of the Reduce-only order is greater than the current position, the system will resize the order size. 
  • Reduce-only orders cannot be used to open positions. 

Reduce-only is available to these order types: Limit, Market, Bid, and Ask. Kindly note that reduce-only orders are currently not available for API trading. 

  • How will WOO X adjust Reduce-only orders?

Any orders for closing positions (including Limit, MKT, Bid, and ASK) need to validate if the total quantity and pending reduce-only orders quantity exceeds the current position. If it exceeds, WOO X will resize the size of pending Reduce-only orders or cancel reduce-only orders to ensure that extra positions will not be opened unintentionally.

 

Examples

You have 10 BTC and a pending Reduce-only order A ( Sell 6 BTC at 10000 USDT ). Here are some scenarios of the workflow of resizing or closing Reduce-only orders:

  • A new order to sell 7 BTC at 9000 USDT: Accept. WOO X will resize order A to 3 BTC since you only have 3 BTC left.
  • A new order to sell 11 BTC at 9000 USDT: Accept. WOO X will cancel order A since there are no BTCs left.
  • A new Reduce-only order to sell 11 BTC at 9000 USDT: Accept. WOO X will resize the quantity to 10 BTC and cancel order A due to the validation rules of Reduce-only orders. A new Reduce-only order to sell 10 BTC at 11000 USDT: Accept. WOO X will resize the latest Reduce only order (10 BTC) to 4. The system will prioritize the Reduce-only orders which are close to the market price and won't adjust them.
  • A new order to sell 10 BTC at 11000 USDT
    • Accept if the Margin ratio is sufficient, users can sell more BTC in margin mode. 
    • Reject if the Margin ratio is below 50% or in pure spot mode
10 BTC and a pending Reduce-only order A: Sell 6 BTC at 10000 USDT.

No.

Order Type

Sell

Result

Reason

1

A new order

7 BTC at 9000 USDT

Accept.

WOO X will resize order A to 3 BTC since you only have 3 BTC left.

2

A new order

11 BTC at 9000 USDT

Accept. 

WOO X will cancel order A since there’s no BTC left.

3

A new Reduce only order

11 BTC at 9000 USDT

Accept. 

WOO X will resize the quantity to 10 BTC and cancel order A due to the rules of reducing only orders.

4

A new Reduce only order

10 BTC at 11000 USDT

Accept. 

WOO X will resize the latest Reduce only order (10 BTC) to 4. The system will prioritize the Reduce-only orders which are close to the market price and won't adjust them.

5

A new order

10 BTC at 11000 USDT

Accept

If the Margin ratio is enough, users can sell more BTC in margin mode.

Reject

If the Margin ratio is below 50% or in the pure spot mode.

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