How Price Moves
Trading Mastery
9 min read
Learn why price changes occur at the micro level through aggressive market orders consuming resting liquidity at the best bid and ask.
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9 min read
Learn why price changes occur at the micro level through aggressive market orders consuming resting liquidity at the best bid and ask.
Everyone talks about "supply and demand" as if it’s some invisible force. But in a real market—on your screen—price moves for a very specific reason:
Because someone placed a market order.
Not because of news. Not because of predictions. Not even because someone wants to buy or sell. Price moves when someone actually does buy or sell—by placing an order that crosses the spread.
In this post, we’ll break down:
Let’s start simple:
For example, if:
That trade becomes the new market price.
Limit orders sit and wait. They don’t move the price. They’re passive.
But market orders? They’re aggressive. They say:
"I want in NOW, and I’m willing to accept someone else’s price."
And that’s what shifts the market.
Example: Let’s say the order book looks like this:
| Price | Amount | Type |
|---|---|---|
| 63,800 | 1.5 | Ask |
| 63,700 | ——— Mid ——— | |
| 63,600 | 1.2 | Bid |
If a buyer places a market order to buy 1 BTC:
If another buyer comes in and buys 2 BTC with a market order:
This is called "sweeping the book." The more liquidity they take, the more price moves.
In markets, people often confuse interest with pressure.
| Concept | Description |
|---|---|
| Supply | People wanting to sell |
| Demand | People wanting to buy |
| Aggressive supply | Market sell orders hitting bids |
| Aggressive demand | Market buy orders hitting asks |
Price doesn’t move because people want to buy or sell. It moves because they’re willing to hit someone else’s price right now.
Understanding what moves price helps you:
"The news is good, so price will go up."
Not unless buyers are actually buying aggressively.
"There’s lots of buy orders below, so we’re safe."
Those bids can be pulled instantly—nothing is guaranteed.
"A whale just placed a big order."
Was it a limit order or market order? Only market orders move price.
Adjust the volatility slider to see how larger price swings create wider candle bodies and longer wicks. Toggle volume bars to see how volume correlates with price movement.