Kid gloves... this might be a stupid question, but I haven't found a real clear answer to this.
So I understand that market orders are orders to execute at current market prices and that the price is not guaranteed, but the trade will be as soon as shares are available. I understand the limit orders are (in the case of a limit buy order) to buy only at or below the stated price.
I also understand the basic difference in bid and ask prices.
Here's where it breaks down. If the market order does not guarantee price, then why isn't a limit or (even if it's a lowball one) executed as soon as there are available shares since the price on a market order is not guaranteed? (I know that there is probably some safeguards in here somewhere, but I would really like to understand it better.)
For instance (and forgive me if I mix up the usage of bid/ask... I promise it sorta makes sense in my head): A particular stock we will call GMMM (Get Me More Money) is trading between $100 and $105 per share in a given day. I want that stock, but not all that bad. I see that the ask volume is 800 (let's assume all market orders) and the bid volume is 200 (also all market orders). If I place a limit buy order for 100 shares at $95 and there are still 600 outstanding shares for sale (and we assumed those were all market order) then why is that limit buy order not executed?