<h2>Limit Order Book</h2>
<p>A <strong>limit order book</strong> (LOB) is a dynamic list of pending orders for a specific financial instrument, organized by price level. It's a crucial component of modern trading platforms, including <strong>MetaTrader 5</strong>.</p>

<h2>How It Works</h2>
<p>The LOB displays the best bid and ask prices, along with the total volume available at each price level. Here's a breakdown:</p>
<ul>
  <li><strong>Bid side:</strong> Contains pending sell orders. The highest bid price is the best bid, and the volume at this price is the best bid volume.</li>
  <li><strong>Ask side:</strong> Contains pending buy orders. The lowest ask price is the best ask, and the volume at this price is the best ask volume.</li>
</ul>
<p>The LOB updates in real-time, reflecting market conditions and order book depth. When a trade occurs, the LOB updates to reflect the new best bid and ask prices and volumes.</p>

<h2>Why It Matters for Traders</h2>
<p>Understanding the LOB is vital for traders as it provides valuable information:</p>
<ul>
  <li><strong>Liquidity:</strong> The LOB indicates market depth, helping traders gauge an instrument's liquidity.</li>
  <li><strong>Price discovery:</strong> The LOB helps traders understand where the market is heading by observing where orders are being placed.</li>
  <li><strong>Placing orders:</strong> Traders can use the LOB to place limit orders, ensuring they're filled at a specified price or better.</li>
</ul>

<h2>Example</h2>
<p>Consider the following LOB for EUR/USD on STB Provider's MetaTrader 5 platform:</p>
<table>
  <tr>
    <th>Price</th>
    <th>Volume</th>
    <th>Side</th>
  </tr>
  <tr>
    <td>1.18500</td>
    <td>50</td>
    <td>Bid</td>
  </tr>
  <tr>
    <td>1.18501</td>
    <td>25</td>
    <td>Bid</td>
  </tr>
  <tr>
    <td>1.18502</td>
    <td>100</td>
    <td>Ask</td>
  </tr>
  <tr>
    <td>1.18503</td>
    <td>75</td>
    <td>Ask</td>
  </tr>
</table>
<p>Here, the best bid is 1.18500 with a volume of 50, and the best ask is 1.18502 with a volume of 100. A trader could place a limit buy order at 1.18501 to potentially buy EUR/USD at the best available price.</p>

<h2>Key Takeaways</h2>
<ul>
  <li>The limit order book displays pending orders, helping traders understand market dynamics and place orders effectively.</li>
  <li>Traders can gauge liquidity and make informed decisions based on the LOB's depth and price levels.</li>
  <li>Observing the LOB can assist in price discovery, as it reflects where the market is heading.</li>
</ul>