When you place an order to buy or sell cryptocurrency, it is sent to the order book. An order book is the place where buyers meet sellers by matching opposite orders. Crypto market order book is dynamic, meaning it's constantly updated in real-time.

A crypto exchnage’s order book consists of three parts: buy orders, sell orders, and trading history.

  • Buy orders include all the bids, the amount buyers wish to purchase, and the price.

  • Sell orders contain information about all the asks, amount to sell, and the price.

  • Trade history shows all the transactions in the order book that have taken place in the past (can be found at the bottom of the Trade page).

At the top of the order book, you can find the highest bid price in the Buy Orders and the lowest ask price in the Sell Orders. These point to the predominant market and price that need to get an order executed. It means when you place a buy order, the lowest ask price will be the first to be filled. Conversely, when placing a sell order, then the highest bid price is the first to be filled.

The order book helps traders to make more well-informed trading decisions. It may also show imbalances between buy and sell order, providing clues in what direction the price may move in the very short term. For example, if you see that the number and amount of buy orders is significantly higher than that of sell orders, it may hint at price movement higher due to buying pressure and vice versa. Traders can also use the order book to find potential support and resistance levels. A big cluster of buy orders at a specific price may suggest a support level, while plenty of sell orders at or near a specific price may be considered as a resistance area.

A market depth chart is a visual representation of the order book, meaning it should help those who don’t know how to read an order book. Market depth reflects the number of all pending buy and sell orders for a particular currency pair. With a market depth chart, it is easier to see how many traders would like to buy the selected crypto at a higher or lower price than the current one and evaluate market liquidity.

On CEX.IO, the market depth chart can be found between order type selector and order book on the Trade page.

Note that each market/currency pair has its order book and market depth chart.

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