Weight of money

[lucacrebbe]

Hello a nooby question about trading

Let's make it simple


Let's suppose the current price in an market (any market , it could be stocks, cripto, forex.) is at 2,20$

Imagine there are a 3 people that want to BUY at 2,30 $ and there is a lot of money that want to be matched at 2,30$ (3 millions in total)

Let's suppose the lowest price the sellers want to sell is 2,40$

Let' s immagine there is less money at buy livel 2,29$ (1 million)

What will happen?

will the price go immediatley to 2,30 $?

If you could explain this mechanism to a noob.

 

[Enivid]

Let's suppose the lowest price the sellers want to sell is 2,40$
Let' s immagine there is less money at buy livel 2,29$ (1 million)

If these are the limit orders, and the buyers are sending market orders with any slippage tolerated, then the first 1 million to get to the liquidity will execute at $2.29, the remaining two - at $2,40. The Last price will get updated to $2.40.

If buyers are using pending stop orders to enter the market, no trading will take place as no prices are matched.

 

[Lesiro]

If the buyer and seller have placed fixed price order, the trade would not be executed. Some other seller/buyer would have to enter the market to bridge this gap