diff --git a/src/gui/price-axis-widget.ts b/src/gui/price-axis-widget.ts
index 857522d1e9..687c1771a4 100644
--- a/src/gui/price-axis-widget.ts
+++ b/src/gui/price-axis-widget.ts
@@ -639,6 +639,11 @@ export class PriceAxisWidget implements IDestroyable {
 		}
 
 		recalculateOverlapping(top, 1, this._size.height, rendererOptions);
+		// move the last top to the first bottom to prevent overlapping between the items in top and bottom
+		if (top.length && bottom.length) {
+			bottom.splice(0, 0, top.splice(0, 1)[0]);
+		}
+
 		recalculateOverlapping(bottom, -1, this._size.height, rendererOptions);
 	}
 
diff --git a/tests/e2e/graphics/test-cases/price-scale/fix-labels-overlapping-when-align-labels-on.js b/tests/e2e/graphics/test-cases/price-scale/fix-labels-overlapping-when-align-labels-on.js
new file mode 100644
index 0000000000..0253d40593
--- /dev/null
+++ b/tests/e2e/graphics/test-cases/price-scale/fix-labels-overlapping-when-align-labels-on.js
@@ -0,0 +1,85 @@
+function runTestCase(container) {
+	const chartOptions = {
+		height: 500,
+		width: 600,
+		rightPriceScale: {
+			scaleMargins: {
+				top: 0,
+				bottom: 0,
+			},
+			entireTextOnly: true,
+			alignLabels: true,
+		},
+		layout: { attributionLogo: false },
+	};
+
+	const chart = (window.chart = LightweightCharts.createChart(
+		container,
+		chartOptions
+	));
+
+	const levels = [
+		7.9,
+		5.44,
+		4.23,
+		4.08,
+		3.42,
+		3.09,
+		2.78,
+		2.24,
+		2.14,
+		2.13,
+		2.12,
+		2.05,
+		2.04,
+		1.92,
+		1.69,
+		1.67,
+		1.47,
+		1.32,
+		1.11,
+		0.90712,
+		0.63113,
+		0.40527,
+		0.20527,
+		0.10527,
+		0.00527,
+		0.00027,
+		0.00007,
+		0.00001,
+	].map(price => ({ price }));
+
+	const colorByIndex = index => {
+		const r = index & 0b10000 >> 4;
+		const g = index & 0b01100 >> 2;
+		const b = index & 0b00011;
+		return `rgb(${Math.floor(r * 255)}, ${Math.floor(g * 255 / 4)}, ${Math.floor(b * 255 / 4)})`;
+	};
+
+	for (let i = 0; i < levels.length; i++) {
+		const s = chart.addLineSeries({
+			color: colorByIndex(i),
+		});
+		s.setData([
+			{ time: 10000, value: levels[i].price },
+			{ time: 20000, value: levels[i].price },
+		]);
+		levels[i].series = s;
+	}
+
+	for (let i = 0; i < 4; i++) {
+		chart.removeSeries(levels[i].series);
+		delete levels[i].series;
+	}
+
+	for (let i = 3; i >= 2; i--) {
+		const s = chart.addLineSeries({
+			color: colorByIndex(i),
+		});
+		s.setData([
+			{ time: 10000, value: levels[i].price },
+			{ time: 20000, value: levels[i].price },
+		]);
+		levels[i].series = s;
+	}
+}