NSE Behaviour When a Stock Hits the +10% Upper Price Limit

When a stock at the Nairobi Securities Exchange (NSE) reaches the +10% upper price limit, trading behaviour changes immediately. That is bids block the highest price and ask/offer/supply side is empty. Let’s break it down properly:

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🔵 1️⃣ BUYING During a Limit-Up (+10%)

✅ What Actually Happens

When a stock hits the upper limit (e.g., from 10.00 to 11.00):

• 11.00 becomes the ONLY price buyers and sellers can use if it is the highest price for that day and supply or offer side is empty.
• You cannot buy at 10.90, 10.50, or any other price until prices come down and open up prices for supply to queue.
• The system locks the price at 11.00.

Price Range: 9.00 – 11.00 and opening price is 10

Bid Qty	Bid Price	Offer Price	Offer Qty
120,400	11.00
32,500	10.90
18,200	10.80
9,750	10.70
6,100	10.60
4,350	10.50
2,900	10.40
1,700	10.30
900	10.20
500	10.10
250	10.00

🧊 What the Buy Queue Looks Like

• Buyers form a queue at exactly 11.00 and supply side is empty.
• They are matched on first-come, first-served basis and supply is subjected to sell at that price since system can't allow past 10% from opening price.
• If sellers don’t place sell orders → no trades happen, even though buyers are queued.

❗ Important Reality

If no sellers are willing to sell at the upper limit:

• 🔒 It becomes impossible to buy.
• You will stay in the queue all day without being filled.
• This remains true even if you:
  • Use Market orders to buy
  • Increase volume
  • Spam new orders
  • Try to buy below the limit (which is impossible at limit-up)
  • If this hits consecutive days then prices may sky rocket upwards.

🛑 Why Market Orders Fail

Market orders = “Buy me shares at the best available price.”

But if:

• The only allowed price = upper limit
• AND there is zero quantity available for sell

Then:

• Market order fails instantly → “No matching orders”
• It cannot drop to a lower price because lower prices are still buy orders and cannot be queued since it doesn’t have price attached to the order

✔ Advice for Dividend Hunters, Momentum Traders, and Position Builders

If you want shares on a limit-up day:

1. Place a Limit Buy at the upper limit (only price).
2. Queue early — pre-open gives best position.
3. Check the buy-side depth:
   • If 50,000+ units are ahead of you, chances of filling are very low.
4. Understand: You will NOT be filled unless a seller places a large enough sell order to clear the queue and orders ahead of you.

🔴 2️⃣ SELLING During a Limit-Up (+10%)

When a stock hits limit-up, sellers have full power because demand is extremely high.

✔ Option A: Sell at the Upper Limit Price

• You set your sell order at the limit (e.g., 11.00). If you sell at market and your order is bigger then you can sell at other lower prices opening the offer queue orders to come in.
• It usually fills instantly because buyers are queued.

✔ Option B: Hold Until Next Day

You may hold if you expect:

• Another limit-up run
• Continued positive sentiment
• High dividend chasing
• Strong news support

Holding carries risk:

• Momentum might fade
• New information may change sentiment
• Profit-taking often hits the next morning
• If the stock gaps down or loses momentum, you may miss the best sell window

🔑 Key Takeaways

For Buyers:

• At limit-up, only one price exists: the upper limit.
• You cannot buy at lower prices.
• You must queue at the capped price and hope sellers appear.
• Market orders fail if no quantity is available.

For Sellers:

• Selling at the limit or market gives instant liquidity.
• Holding is a strategy, but risky if sentiment flips the next day.