Disliked{quote} Yes it's hard to become market maker but it's easy to become the market so to speak. Difference being the market maker knows what to do and avoid blowing up. Becoming market is just buying so much that no one else has anything left to sell. Technically that can happen under the theory I explained where market is divided into ranges where people are interested in trading. If you are the "last one in" and aren't the market maker, your trade could be the one causing end to that range. If you go to very short timeframes, this happens *all the...Ignored
Those kind of fast downmoves (spikes) are usually watched calmly by buyers, they don't buy anything until everybody have sold what they was looking to sell (and bringing price down in the process as no real buyers are interested in play the game), then after sellers are "all-in", buyers start to buy and guess what, there are no sellers anymore willing to sell them, so price will start going up, untill sellers will be forced to start taking loss.
Same process happening again and again every minute/hour/day/week/month on every timeframe, yes that's basically how market work.
I agree no matter what, entering a huge (big enough to move the market) position all at once isn't really a smart idea.
But, this kind of things happens on a level way above our (i don't know about you, but surely above my level), if you don't have a billion dollar account (with a real broker, not a retail crap) chances are that you are not affecting the market at all.
Fx daily volume (2013 data) is around 5.3 usd trillion, that translated in lots is about 53 million lots.
53 million lots traded everyday in the fx market, and around 87% of those are traded in usd currencies, 33% on eur, 23% on jpy, 12% on gbp etc.
I mean even if you open a 1.000 lots buy position (10k / pip) on eurusd you may cause a temporarily (perhaps one second) spike of a few pips, that's all. And even in that case, you would not move the price, you would simply get a bad fill on your trade by consuming the offers at the near pips, then if market makers want to put new offers or just move the bids in your favour is up to them. (probably they are not going to care at all about your 1000lots order, they are fighting each other all the time with way bigger sizes and they just have their game playing all the time, not caring about single private investors).
Also, if you do this with any retail broker, you are just going to get a bad fill and that's all (you would not even see the ask in your tick chart go where you got the fill, no interaction with the chart at all, just consume the offers of the shitty liquidity providers of your retail broker, and that's it).
Unless you trade millions of lots you are not going to affect the market at all, really, believe me.
I know the feeling of see price reverse exactly one moment after you buy or sell, and never come back, go all the way to hit your stops, and just reverse after that (this is the extreme example).
It looks like something magical (black magic!?!?) happens, there are many coincidences in this market, sometime it really looks and feels
like the market is damn knowing when and how much we are buying or selling, and how to make us the most possible damage.
It happened to me so many times, and i wondered how that was possible, how can this sort of weird coincidences happens on a daily basis, then after some time the exact opposite started to happen.
Whenever i bought price started going up, and kept going until the tp is hitten, then with sell etc.
I come to the conclusion that some strange coincidences are not due to the fact that we interact in any way with the market, it's all about our mindset and the unconscious believes we have, most retail traders believe on an unconscious level that they are not entitled to make big money, so unconsciously they pick the wrong side of the market at the very wrong time, and the result is the "market is fucking me" feeling, again it is something that happen on an unconscious level (we are not aware of it), so well we would need to open a thread to discuss this very interesting and fascinating fact as it is very complex and really only a few are aware of it.
Nothing is what it looks like.