Understanding Stock Market Structure — How “Price” Is Really Made
Understanding Stock Market Structure — How “Price” Is Really Made 3-Line Summary A stock market doesn’t “decide” prices by emotion; it follows rules. Price is created through the sequence Orders (quotes) → Executions (trades) → Price discovery . If you understand this structure, you reduce costly mistakes—especially rushed buys and panic sells. Recommended Keywords stock market structure, how stock prices are determined, order book explained, bid ask spread, trade execution priority, market order vs limit order, volume and liquidity, price discovery mechanism, stock trading basics, order matching engine Table of Contents The Market Is Not a Feeling—It’s a Rule System Who Moves Prices: Market Participants Orders: Market vs Limit (and Why It Matters) The Order Book: Where Price Is Born Execution: Matching Rules and Priority Open, High, Low, Close: The Daily Price Map Volume and Turnover: Where the “Real Force” Lives Spread and Liquidity: The Invisible Cost Seven Common Market Illus...