When a stock hits the upper circuit, it has reached its maximum allowed price increase for the day, leading to a trading halt. During this time, only bid orders (intentions to buy) exist without any corresponding ask orders (intentions to sell), meaning while you can sell shares at the capped price, you cannot buy any more shares as there are no sellers. For instance, if FYERS XYZ stock hits the upper circuit, sellers can offload their holdings at this maximum price, but buyers will find no available shares.
In contrast, when a stock hits the lower circuit, it has fallen to its minimum allowed price for the day. Here, only ask orders are present, indicating that shares are available for sale, but there are no bid orders, so you cannot sell any shares you own. For example, in the scenario where FYERS ABC stock hits the lower circuit, investors can purchase at this lower price, but those looking to sell are unable to do so until the market stabilizes and trading resumes.
Before initiating orders, it's beneficial to check the market depth, which provides insights into the supply (ask) and demand (bid) at different price levels. This information helps traders understand potential price movements and make more informed decisions about entering or exiting positions.