What moves price
Price is simply the last deal between a buyer and a seller. It moves when one side is more eager than the other.
Buyers, sellers and orders
- Market order: "buy or sell now, at any price". Market orders push price.
- Limit order: "buy only at 1.1000" or "sell only at 4,050". Limit orders wait, and act like walls.
- Stop-loss order: waits quietly, then becomes a market order when price touches it. Many stops in one place can make price jump.
If buyers want more than sellers offer at the current price, price must rise to find new sellers. That is a move up.
Big players
Banks and funds trade very large sizes. To buy a huge amount they need a huge amount of sellers. So price is often drawn to places where many orders wait, such as just above an old high where many stop-losses sit. That idea is called liquidity (Lesson 9).
The deeper reasons
| Driver | Example | Usual effect |
|---|---|---|
| Interest rates | US central bank (Fed) raises rates | USD up, gold down |
| Economic data | US jobs report (NFP), inflation (CPI) | Fast spikes at the release time |
| Fear and war | Military strikes, crisis | Gold, USD, JPY, CHF up (safe havens) |
| Flows | A fund buying euros for a deal | Steady push in one direction |
Gold
Gold (XAUUSD) is priced in US dollars. It often moves opposite to the dollar, and rises when people are afraid. It moves about $20 to $60 a day, more on big news.
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