Basic question: In an industry that boasts 4 trillion daily volume, with tens and thousands of lots committed daily, how can our tiny 0.1 lot trade, 1 lot trade, or even 10 lot trade impact the global market?
Slippage does make sense and it is possible during both high and low volume trading activity. I can see that. But requote? For retail traders?
I can see how banks would be hesitant to put $300 million trade. Liquidity issue is as clear as daylight. They want to be sure that they can get out of the trade when they want to get out. But us little fishes?
Common wisdom teaching introduces us the concept of requote for retail traders. When there is "not enough liquidity," even for the majors, your broker may requote you for a price that is different than your original request, giving you a disadvantaged entry/exit. And ALWAYS a disadvantaged entry/exit. If there is really a liquidity issue, the possibility of better price must also exist.
Does this have a justifiable and valid reason? in a 24/5, 4 trillion dollars market?
Are these guys saying that there is liquidity issue both at low volume and high volume trading activity, since those two times are the most likely to give us requote? So we have the same reason for 2 completely opposite situations? There is not enough buyers and sellers at low volume, AND high volume? I've seen FF members jump from ~8,000 members online to ~24,000 prior to news release, and you're telling me that there is less liquidity there?
In economics, the higher the number of market participants, the lower the price for transaction due to competition and the easier it is to make a trade.
So the question is: why does requote happen to retail traders? How is it that my 0.1 lot size trade affecting the global market?
Even if, that's a big if, there is a serious or no liquidity at all, shouldn't we get a total rejection of the trade instead of offering a new and ALWAYS worse rate? The broker may say "dude, it's 1 am, nobody trades at this hour. Go home, get a life." Your first reaction to my seemingly silly question would be, "you fool, there are simply no buyers/sellers JUST at that particular point of price. That's why you get requote." Really? While everyone sees almost the same price and chart globally? When it's night in one session, it's daylight on the other. That's the whole premise of forex. 24/5 market.
I know requote traditionally happens with MM brokers who trade against you. But I heard this also happens with ECN brokers. The explanation in both cases is financial incentive, not real liquidity. I think this is just a trick that brokers use that has no validity at all. It's a made up trick of trade.
Bottom line: Requote and liquidity issue for retail traders DO NOT make sense at all. Correct me if I'm wrong.
Slippage does make sense and it is possible during both high and low volume trading activity. I can see that. But requote? For retail traders?
I can see how banks would be hesitant to put $300 million trade. Liquidity issue is as clear as daylight. They want to be sure that they can get out of the trade when they want to get out. But us little fishes?
Common wisdom teaching introduces us the concept of requote for retail traders. When there is "not enough liquidity," even for the majors, your broker may requote you for a price that is different than your original request, giving you a disadvantaged entry/exit. And ALWAYS a disadvantaged entry/exit. If there is really a liquidity issue, the possibility of better price must also exist.
Does this have a justifiable and valid reason? in a 24/5, 4 trillion dollars market?
Are these guys saying that there is liquidity issue both at low volume and high volume trading activity, since those two times are the most likely to give us requote? So we have the same reason for 2 completely opposite situations? There is not enough buyers and sellers at low volume, AND high volume? I've seen FF members jump from ~8,000 members online to ~24,000 prior to news release, and you're telling me that there is less liquidity there?
In economics, the higher the number of market participants, the lower the price for transaction due to competition and the easier it is to make a trade.
So the question is: why does requote happen to retail traders? How is it that my 0.1 lot size trade affecting the global market?
Even if, that's a big if, there is a serious or no liquidity at all, shouldn't we get a total rejection of the trade instead of offering a new and ALWAYS worse rate? The broker may say "dude, it's 1 am, nobody trades at this hour. Go home, get a life." Your first reaction to my seemingly silly question would be, "you fool, there are simply no buyers/sellers JUST at that particular point of price. That's why you get requote." Really? While everyone sees almost the same price and chart globally? When it's night in one session, it's daylight on the other. That's the whole premise of forex. 24/5 market.
I know requote traditionally happens with MM brokers who trade against you. But I heard this also happens with ECN brokers. The explanation in both cases is financial incentive, not real liquidity. I think this is just a trick that brokers use that has no validity at all. It's a made up trick of trade.
Bottom line: Requote and liquidity issue for retail traders DO NOT make sense at all. Correct me if I'm wrong.