Definition. A market order fills immediately at the best available price. A limit order waits in the book to be filled at the specified price or better.
How it works
Limit orders create the liquidity visible in the DOM (the passive side). Market orders consume that liquidity (the aggressive side). Every trade is a meeting of the two.
Example
A buy limit order at 51,900 waits in the book. A market buy order fills immediately at the best ask.
What to watch out for
A market order guarantees execution but not price (slippage risk). A limit order guarantees price but not execution.
You'll find the full explanation with graphics, examples and exercises in the 🖥️ Order flow atlas space, and its use in the live market in the 🔴 Live Room. Both are available to Club members (in Polish).
