Who will pay for your money ?

Some of you are getting warm.

Just think about what candles fundamentally represent.

That depends on the viewer. For some it doesn't represent anything as they don't care about them.

X:

Who exactly are they,those who hold very large chunks of money and don't care if they win or lose?

Mildly curious.

s

Companies, e.g. those who produce in Europe but want to sell outside Europe. They have to hedge and swap currencies.

Or take banks who want to buy US treasuries or US stocks. They won't look at a chart they just take the current price. That's one reason why shorter timeframes are so noisy. There are so many players who just want to swap at the current rate and don't look at charts either.

This has been bugging me now for 24 hours, mainly because I always thought it was zero sum (or erring slightly negative).
Xaron mentions banks and commercial hedgers don't require profit. Neither do central banks in this respect. Or anyone whose transaction in the spot market cost less than the benefit received outside of spot. But the motivation of the participants doesn't stop it being zero sum does it?

Presumably because the change in price represents a change in the value of the currency, this skews the zero:sum relationship (ignoring spreads).
So i short the pound from 2 to 1.4, and the pound is my home currency, I have gained X % on my account but lost y% in value.

X:
Essentially correct answer,good enough for newbs to know though.

Most corps. etc do analyze the markets though,if they feel something (currency,stock,commodity,repatriation) is cheap or expensive they will hedge early ie. they feel oil will drop,yet feel theirs will drop too.If they get it wrong, basically it's a push.But if they get it right (oil drops ,theirs strengthens) they really get it right... etc. etc.

Yet more shades of grey in FX


trip:

Candles represent the struggle between fear and greed,bears and bulls.

I'm quite content with a 300 pip day,but the banks/corps etc buying up my now sold contract may think I'm a fool for getting out so early.


One of my best experiences was sitting behind the desk of an institutional trader in my bank in Switzerland, and watching him pull off $100-500 million deals.

Hmm... doesn't change it from being zero sum though. The motivation doesn't change anything. Just because they didn't enter into the trade specifically to gain, doesn't stop their being a winner/loser on the trade.

been fun guys, but the "winner" is only in the mind of the one who "needs" to think that way --- ive shown how so many trades have NO winner or loser, although it was passed right by since no one wanted to tussle with the truth.

ZERO SUM is for those who NEED to prove a win over someone or something else --- in trading forex there is rarely a winner or loser as the brokers are handling the other side of your trade, and then go to the ECN's and counter their counter by trading there.

it becomes laughable, as the money simply goes round and round, changing hands, being destroyed, being reprinted and coming back to each of us in turn.

its a GAME and the only losers are the REAL losers who dont know how to play the game.

sorry, but "zero sum" is simply a white collar make believe war, cause you can never truly identify who is a casualty and who isnt !

my opinion, of course, but i have a danged good run of "winners" and i dont see any bloody bodies lying at my front door !

live, laugh, enjoy and trade well

mp