Market depth
The distribution of resting buy and sell orders across price levels.
Plain languagePractical exampleConnected reading
01
What is it?
The distribution of resting buy and sell orders across price levels.
02
Why does it matter?
Depth gives a live indication of how much a large order may move price.
03
How should it be read?
Observe how levels change over time alongside actual trades.
04
Common mistake
Assuming every displayed order will remain and execute.
A simple example
A thin offer side can cause a medium-sized market order to sweep several price levels.