The Conditional Close option allows traders to set up a second, opposite order that is placed only when the primary order executes. The Conditional Close feature is useful for "automatically" closing an open spot position on margin at a targeted profit or loss.
However, the Conditional Close cannot be used to set both a profit target and stop loss target at the same time. In other words, it is not possible to place “Combined” or “One-Cancels-the-Other” type orders using a Conditional Close order.
Conditional Closes are optional
You do not need to use a Conditional Close order to close an open spot position on margin.
For more information on how to close an open position on margin, see these articles:
Conditional Closes can open a new spot position on margin
Be careful: If you open a spot position on margin using an order that includes a Conditional Close, but then close that spot position on margin using a different order, this will not automatically cancel the Conditional Close order. The Conditional Close order, if/when triggered, will open a new position in the opposite direction.
If you no longer want the Conditional Close associated with an open spot position on margin, you will need to manually cancel it from the list of Open Orders. Your Open Orders can be found by selecting Trade from the menu at the top of the page and then selecting the Orders tab.
How to place a Conditional Close
Conditional Close orders must be programmed at the same time as their primary order. You cannot add a Conditional close to an order after it has been submitted.
On Kraken.com, the Conditional Close option can be found on the Advanced Order form.
On Trade.Kraken.com, there is a checkbox in the order form window labeled “Conditional Close”.
On the Kraken Pro mobile app, the Conditional Close option can be found by clicking on the new order button, selecting the 3 dots to display more options and scrolling down the bottom of the page.
The volume of the Conditional Close order will always be equal to the primary order, and the direction (buy/sell) will always be opposite the primary order.
A Conditional Close order can be set using the following order types:
✔️Limit (executes at a desired price or better)
✔️Stop Loss (triggers a market order when a target price is touched)
✔️Take Profit (triggers a market order when a target price is touched)
If price offsets are used instead of a specific price, the prices will be offset from the price of the primary order.
Conditional Close as a Stop Loss
Suppose the current price of XBT/USD is $6100. You place a limit order to buy 0.8 XBT/USD at $6000, but you want to limit your losses on this long position once it opens. You could sign back into your account and place a new Stop Loss order to sell 0.8 XBT/USD at a price of (for example) $5800 after the limit order has executed, or you could program a Conditional Close order into the original limit order before it is submitted. You could attach a Conditional Close order of type “Stop Loss” with Stop Price of “$5800” to your limit order.
As soon as the limit order to buy 0.8 XBT/USD at $6000 executes, the Conditional Close order to sell 0.8 XBT/USD with a Stop Loss order at a stop price of $5800 would be placed.
Conditional Close as a Take Profit
Suppose the current price of XBT/USD is $6100. You place a limit order to buy 0.8 XBT/USD at $6000, but you want to place a Take Profit order to close this long position once it opens. You could sign back into your account and place a new Take Profit order to sell 0.8 XBT/USD at a price of (for example) $6300 after the limit order has executed, or you could program a Conditional Close order into the original limit order before it is submitted. You could attach a Conditional Close order of type “Take Profit” with Profit Price of “$6300” to your limit order.
The price does not go down to $6000 to fill your limit order and instead increases directly to $6400. Since the primary (order to buy 0.8 XBT/USD at limit $6000) did not execute, the Conditional Close order was never placed, and no orders have executed. The Conditional Close Take Profit order will only be placed if the primary limit order executes.
The price falls to $6000 or below. As soon as the limit order to buy 0.8 XBT/USD at $6000 executes, the Conditional Close order to sell 0.8 XBT/USD with a Take Profit order at a profit price of $6300 would be placed. Now that the order has been placed, this Take Profit order will act like a regular Take Profit order -- it will execute as a market order once the last traded price reaches $6300.