Sell Order Added to the Asks Ledger
After the previous trade, the latest reported price is $10
Event: At a seller submits an order to sell 3 apples at $11 each.
The order is recorded in the asks ledger
At this moment, the book contains two orders:
- A - an ask to sell 3 apples at $11
- B - a bid to buy 2 apples at $9
The trade tape still shows C - the last completed trade - 5 apples at $10
What happens
No trade occurs.
The lowest sell price in the book is $11 and the highest buy price is $9 Because the buy and sell prices do not overlap, no execution can occur.
The book now contains open orders on both the buy and sell sides, but at non-overlapping prices.
The reported price does not change.
It remains tied to the most recent trade recorded in the trade tape, not to newly added orders in the book.
Conclusion
Adding orders to the book does not change the reported price.
Only a completed trade updates the reported price.