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.
This is the DOM – the order book in the Hetman Terminal (Front Line). Screenshot from the Hetman Index (IHA) – a training instrument, simulated data. See all the Hetman Terminal tools →
♛ The Hetman Terminal is part of Club: live for Dow Jones from the Bishop plan, 6 markets (Dow Jones, S&P 500, Nasdaq, gold, crude oil, Bitcoin) and automatic detection of order flow events from the Rook plan. A session on the ♛ Hetman Index (training, simulated data) in the full panel comes with the Knight plan and above. Compare the plans →
You'll find the full explanation with graphics, examples and exercises in the 📖 Order flow encyclopedia space, and its use in the live market in the 🔴 Live Room. Both are available to Club members (in Polish).
