GS watermark question

I think i understand the GS progression for an item dropping and your GS watermark being set at the highest dropped item.

My question is : Does the lower end of the GS range also increase as the higher end moves?

if a 505 item drops and my that is higher than my previous 500 does the say 490 lower GS also move up by 5 to 495 - making my new range 495 - 505 or does mob level set the min and only the max can raise to the cap based on the mob level?

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