In plain English
What Limit order means
A buy limit is placed below, or sometimes at, the current available market price; it sets the most the buyer will pay. A sell limit is placed above, or at, the current price; it sets the least the seller will accept. The order remains unfilled unless executable liquidity becomes available at the limit price or better.
Why it matters
Limit orders separate price certainty from execution certainty. They can prevent a trader from accepting a worse price than intended, but the market can touch a displayed level briefly without filling the order, or move away before sufficient volume is available. Rules for duration and partial fills vary by platform.
Example
EUR/USD is quoted at 1.0840/1.0842. A trader enters a buy limit at 1.0835 for 100,000 euros. The order may fill if sell-side liquidity is available at 1.0835 or lower. If EUR/USD rises instead, it remains unfilled; paying 1.0842 simply to obtain a fill would not occur under that instruction.
Quick answers
Common questions
Can a limit order fill at a better price?+
Yes. A buy limit may execute below its limit price, and a sell limit may execute above its limit price, where the venue or broker’s execution process makes that price available.
Why did price reach my limit but my order not fill?+
The displayed price may have been based on a different quote side, may have existed only briefly, or available volume at that price may have been consumed by orders ahead of yours. Broker-specific execution and trigger rules also matter.
Sources