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For example I am put a limit order of size 10 at top bid. moments later, my algorithm detects we should have size of 50 here. So we request a update on this order.

My question is, will we lose the current queue position due to this update?

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Yes. Increasing the size of an order is like cancelling and reinserting it. You lose queue priority and insert behind the other orders.

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It depends on exactly which market we're talking about. But in general with price/time priority markets this is true. –  Louis Marascio Feb 12 at 22:43
    
@LouisMarascio, I wonder, is there any exchange that allows to keep the queue in this case? –  Serg Feb 13 at 12:50
    
What if my update action is actually to reduce the quantity? –  cynric Feb 14 at 19:54
    
You do not lose queue priority then. But check for the exchange and market you are interested in. This might differ from exchange to exchange and from market to market. –  Konsta Feb 15 at 21:03

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