Say I placed the limit order when BTC was worth 16000, and the price never goes to 16500 but goes to 16450 the next day. even though my 1 btc is tied up in an order: when I put the order in BTC was worth 16000, will it still gain in value to 16450
Of couse. You still own that 1 BTC.
The order is just an instruction, like saying "automatically sell/buy if it hits X".
1. BTC is at $16,000. You put an order to sell your 1 BTC at $16,500.
2. BTC goes to $16,450. Nothing happened. You still own 1 BTC, now worth $16,450.
You can:
a) cancel the order, you still own that 1 BTC, worth whatever is the price at any moment (so $16,450).
b) let the order execute (if the price hits your price spot), you sell the 1 BTC and you get the amount in USD.
c) market sell for the current price, so you sell for $16,450. You get that amount in cash.
If you just leave the order there and BTC goes to $16,500, your order is executed and you sell your 1 BTC for $16,500.