Your edge

Before I start I want to ask a question; what percentages do you think each of these players take up in the market?

% big boys - (funds, banks, trading houses, ect.)
% trading bots
% retailers

I seriously doubt anybody really knows. Forex is a decentralized market with many public exchanges and far more private ones.

typical numbers you hear are 10-15% retail and the rest are big boys. Trading bots are said to be 70% of the market... but both retailers and the big boys use them.

Why does it matter?

Tyoon, check out the BIS surveys, they give a relatively good breakdown of participants. Probably more important is the order of participants though IMO.

Hey TipHop.....shouldn't the read "Beware of Greeks bearing formulas" HeHeHe....

Lol, I didn't realize this thread was moved to the trading discussion area. It was in the member's lounge initially.

I wanted to get an idea (from others) of these percentages before I tried to explain something that has been bugging me. I will get around to doing it later when I have a bit more time.

Thanks trip. Will check it out.

Just found this thread. I think it could matter quite a lot if your stat about bots is anywhere near truth.

For bots to work, they need to identify key areas in order that they execute trades. Whether those be fibs, S+R, supply & demand (same thing to many), round numbers, MAs, pivot points, sessions highs and lows.....you get the idea. Or perhaps they are triggered when price move x pips from y. I really don't know as I've never used one and never intend to but to understand more about how they typically operate could give extra validity to some technical indicators, if there was any real way of corroborating the facts.

It could also put paid to the belief that what drives the markets is a collective union of human emotion. If bots are doing most of the grunt work, the remaining portion that is driven by human emotion won't drive the markets anywhere near as much as we are often told it does.

It could all help each one of us unravel the mysteries of the charts...IF it could be corroborated. Which it probably can't.

Meh.

Yeah, I actually think that bots add to predictability but also volatility. But still, humans are important provided they are responible for the marginal difference. For example, if for every 1001 trades, 1000 are by bots but in perfect balance, then the 1 trade by a human will be 100% responible for the change in price.

If you ask those who work in prop shops they will tell you the market is 99.99999% bots

Most of their day consists of slamming the desk and chanting 'f***ing algos* in unicen