Basic Forex Question

What if we all go the same direction.. If we all go LONG or go SHORT.. What will be it's effect on the Market?

No trades.

For every seller there must be a buyer and vice versa.

So if we all go short who will buy???

and if we all go long who will sell???

here is a great thread for this subject.

http://www.forexfactory.com/showthread.php?t=7484

so, do you mean that there will be no move on the chart??

if majority of all the traders go SHORT will that make the chart go down or go up??

I am just curious because of these FOREX ROBOTS being too commercialized and if most traders do use it, what will be its effect on the market?

You sort of get this effect when important news is released and the result is extreme. The price gaps out of range. Brokers increase spreads dramatically. It's almost impossible to get an order executed. It is impossible to get an order executed at your strike price.

Think January sales...

So, why do traders share strategies then?

Well, if all traders execute short trades, the price would go down, but if all traders were trying to execute short trades, there would be no trades willing to buy, so the market would stand still, and no trades would occur. If no trades occur, the quoted prices would not change - from the perspective on the chart, there would be no change because there would be no trading.

Now, as to the question of whether or not this could ever realistically happen, I would say no. There are far too many robots out there (and more being created every day) for any one to grab a significant share of the trading market. Even if you had one that was REALLY GOOD, there would still be plenty of others being sold due to the fervency and efficiency of the marketing community, which could sell sand to an Arab, and ice water to Eskimos.

Besides, there are many different platforms, so any one robot could only be used by those who trade with platforms that allow automated trading, and of those, only the ones who used the platform that the MAGIC robot was programmed to run on. MT4 has a large share of that market, but its a small share of the overall market.

Professional traders typically have a much larger stake in the market than the average retail trader, so their trading would carry more weight overall, and I seriously doubt that many successful traders and account managers use MT4 EAs in their trading. The biggest chunk (by a very large margin) of the market is the institutional sector that originated the Forex market in the first place. Many of them do in fact use automated systems, but they are NOT using FAP Turbo or Forex MegaDroid

Don't worry, the market will never lose its chaotic and unpredictable nature, nor will there suddenly be a drought of liquidity. Traders are an unorganized, undisciplined, often unreasonable and at least semi-random group. Getting them to trade together - even a little bit - would be like herding cats with a stick.

If you mean retail traders like us, it would be about the affect of an ant trying to lift an elephant. In other words, we don't matter. We just like to think of ourselves as important.

Yea but if we go the same direction together we may affect the market. I am talking about like 10,000 small ants work together.. hehehe.

Will that be possible?

Yes a single ant would be like a single trader and a colony of ants would be like a community of retail traders. In the end, not much difference altough the effort would be greatly increased.

Perhaps 100 Million ants! We really are just specks of dust in the Forex wind, you know...

I don't really know the numbers but imagina the $$ that we put in the game VS the $$ that the big groups put in the game.

i would bet on something like 95% - 15%

Am i right ? Anyone know the aprox numbers ?