Why do buyers ask to buy shares at much higher than the selling price?

[pj2105]

Regarding the below image. This is the 'market depth' of BHP this morning.


http://i221.photobucket.com/albums/dd272/pj2105/Stocks/Capture.jpg

As the sale price last Friday was $34.01...

...why are there buyers this morning asking to buy shares for $50+ a share?
...why are there sellers this morning asking to sell their shares at less than $30 a share?
...if the first shares trades this morning was the guy willing to buy at $50 a share and he bought the shares from the guy selling at $30 a share, what is the actual sale price? $50, $30, half way or some other price?

[Trembling Hand]

it's a conspiracy :(




http://www.aussiestockforums.com/forums/showthread.php?t=11619

[Stormin_Norman]

one of the EAs im working on looks for volatility, and when it finds it sets a buy and sell order either side of the market.

could be a similar trading logic. that if the price breaks out itll continue to 'go'.

the sells could be stop losses.

[AlterEgo]

Simply to make sure they get their order filled at the opening price for the day. It never actually trades at those silly prices you mentioned.

[Julia]

pj2105: this will explain it for you:

http://www.asx.com.au/resources/education/basics/open_Close.htm

[nunthewiser]

just a plain ole auction matchup .......... nothing sinister , nothing freaky . many posts about the auctions in ASF already ...........

[beamstas]

Lets say you want to buy rio for $60 a share
it closed last night at $55 a share

This morning it's going to open at $59 each because lots of people want it (you don't know its going to open at this price though until the market actually opens.. you can get some idea from the VWAP but there are lots of changes in the last few seconds)

Because your limit was at $60 you will be filled on the open price

If your limit was at $56 then you wouldn't get filled, becuase the price gapped over your buy limit.

You don't actually pay $60 for the share, it's just what you are saying is your MAXIMUM buy price. You will pay the market price at the time of buying.

Hope this helps

Brad

[pj2105]

But why would the sellers put in that they want to sell at $20 a share?
Why wouldn't they just say sell at the market price? It closed at $34 a share.
They must be making a loss stating $20 and not the market price.

thanks




Lets say you want to buy rio for $60 a share
it closed last night at $55 a share

This morning it's going to open at $59 each because lots of people want it (you don't know its going to open at this price though until the market actually opens.. you can get some idea from the VWAP but there are lots of changes in the last few seconds)

Because your limit was at $60 you will be filled on the open price

If your limit was at $56 then you wouldn't get filled, becuase the price gapped over your buy limit.

You don't actually pay $60 for the share, it's just what you are saying is your MAXIMUM buy price. You will pay the market price at the time of buying.

Hope this helps

Brad

[doctorj]

But why would the sellers put in that they want to sell at $20 a share?
Why wouldn't they just say sell at the market price? It closed at $34 a share.
They must be making a loss stating $20 and not the market price.

thanks


pj2105: this will explain it for you:

http://www.asx.com.au/resources/education/basics/open_Close.htm
Julia's got the answer for you... spend the time and have a read...

[Trembling Hand]

But why would the sellers put in that they want to sell at $20 a share?
Why wouldn't they just say sell at the market price? It closed at $34 a share.
They must be making a loss stating $20 and not the market price.

thanks

Mate did you read the links provided for you? it would seem not! :banghead:

You cannot place an "@market" order until the market is trading.

This is a guaranteed way of getting the opening price. it WILL not be at $20.

Please read the links