Chapter 5: How Markets Actually Behave

Welcome to Chapter 5: How Markets Actually Behave.

Markets don’t move randomly, and they don’t move because they “want” to go higher or lower. They move as a result of participation—buyers and sellers interacting through an auction process where liquidity, volume, and timing shape every price change.

In this chapter, we’ll focus on what the market is actually doing: how orders are matched, how liquidity appears and disappears, and why price behaves differently at different times of the day. Understanding these mechanics is the foundation for everything that follows.