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Every time you win, someone else loses, and vice versa?

  • #21
  • Jun 12, 2013 12:11pm Jun 12, 2013 12:11pm
I also believe in that.
In order to make money someone or many other traders have to lose the same amount of money vs. the super traders/dealer.
Because it's a zero sum game.

A very long time I deeply thought about this phrase and asked myself how to profit from that.

In this business you can either buy or sell. That's what most traders do, right?

So what must Mr. Elite super trader/dealer do to profit from poor uninformed traders?

They must create volatility so that a lot of them flat their positions with losses.

They only sure thing you will ever know is: there will be volatility in time intervals.

So instead of just buy or sell trade the volatility.
  • #22
  • Jun 12, 2013 12:15pm Jun 12, 2013 12:15pm
someone has this quote in his signature

“Buy when cannons are firing, sell when trumpets are blowing, Buy when there's blood in streets, even if it's your own;"
Nathan Rothschild

buy cheap, sell high, watch bloomberg
  • #23
  • Jun 12, 2013 12:35pm Jun 12, 2013 12:35pm
Quoting juhanimi
someone has this quote in his signature “Buy when cannons are firing, sell when trumpets are blowing, Buy when there's blood in streets, even if it's your own;" Nathan Rothschild buy cheap, sell high, watch bloomberg
Yep... There is a great example of that actually I will dig it up when I can be bothered but basically it was last year or the year before some time... I actually called it on the music thread but didn't trade it unfortunately...

In a nutshell the Eur situation was very alive and getting worse yet the EUR/USD kept rallying higher and higher on growth news, one release after the other, bam bam bam, even though it was blatantly obvious that the international banking system was in jeopardy, and this was a bigger issue than the economic figures coming out the market just kept rocking on up, stocks were soaring.... But looking ahead it was obvious that the market was desperately seeking a very very large bout of supply/ liquidity above for obvious reasons... Then almost to the pip, one Monday morning in the Asian session whilst most Bulls around the world were sleeping, the market hit this liquid zone and suddenly, starting with the Yen, one bad news release after the next started coming out and that was the Top of the Euro... That price has not been hit since..

So what comes first.. The Chicken .. Or the Egg? :nerd:
Time hides Nothing
  • #24
  • Jun 12, 2013 12:42pm Jun 12, 2013 12:42pm
yes, i did saw that bitcoin, they had a big campaign for bitcoin for a few days in bloomberg in april this year
http://www.forexfactory.com/showthre...36#post6738736

that was funny to watch, they just did hype herd to buy, and then chrash, that is the way world works , do the opposite
  • #25
  • Jun 12, 2013 2:20pm Jun 12, 2013 2:20pm
Quoting juhanimi
yes, i did saw that bitcoin, they had a big campaign for bitcoin for a few days in bloomberg in april this year http://www.forexfactory.com/showthre...36#post6738736 that was funny to watch, they just did hype herd to buy, and then chrash, that is the way world works , do the opposite
My example above was an extreme example, perhaps the most massive I've ever witnessed... But on a small scale the same thing happens every Month, Day, Week... The Face Book float was a good one... Every man and his mungral walked straight into the bubble... A rare case though...

It's always a mixture of Psychology, Market Mechanics, and the undertow always being core Fundamentals... If they were labeled 1,2 and 3 then you may have a 1, or a 13, or a 123, or a 31 or a 23, depending on the present situation... How the fk, could anyone possibly hope to carve an ever lasting technical pattern out of that... I have certainly tried.. Or a core fundamental strategy... You just need to play the game as you see it. The better you see it, the better you play it...

I believe it was Darkstar who introduced the notion of Game Theory

Keep the threads coming Ishtana.. There is no such thing as a stupid question, only stupid people
Time hides Nothing
  • #26
  • Jun 12, 2013 2:38pm Jun 12, 2013 2:38pm
Indicators wont show you where market movers are going there the ones who gave us the indicators so that they know where we are going. The chart tells us where they place the orders I discovered this and am profiting from this info so can you.
  • #27
  • Jun 12, 2013 2:43pm Jun 12, 2013 2:43pm
"Keep the threads coming Ishtana."

Yes, he has good analytic mind, like a fresh wind in this factory.

Have to go back to that bitcoin again, sorry for that.

When they praised bitcoin few days, they were talking like: Bitcoin is better than diamonds, bitcoin is maybe only currency in the world in future, bitcoin is just awesome, OMG we just love bitcoin so much, it is absolutely fantastic.

And they did this 2-3 days, and price went up, so crowd was buying (greed), and then came crash.

After that chrash talking was something like this: Is Bitcoin a bubble? What is this Bitcoin-shit? and so on..
Why they talked like that, they did not want crowd to buy (fear) Cheap Bitcoin.

Same goes on with currencies.
  • #28
  • Jun 12, 2013 2:51pm Jun 12, 2013 2:51pm
Quoting fxpivots
Indicators wont show you where market movers are going there the ones who gave us the indicators so that they know where we are going. The chart tells us where they place the orders I discovered this and am profiting from this info so can you.
Well ya know, sometimes they actually will..
Time hides Nothing
  • #29
  • Jun 12, 2013 3:05pm Jun 12, 2013 3:05pm
Every time you win, someone else loses, and vice versa?

Yes, but more precisely money flows from 1 account to the next until it ends up being used to build your broker's spanking new office and put his kids thru college and the wife's boob job.
  • #30
  • Jun 12, 2013 10:35pm Jun 12, 2013 10:35pm
Yes it happened that when we win someone loose at the same time. Actually it is all buying and selling. We sell and other buy on that rate. When we buy others sell their positions. In this way some one gets profit and some one loose This all is working in a cycle and forex market is running.
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  • #31
  • Jun 13, 2013 2:00am Jun 13, 2013 2:00am
I agree with what you all said, and thanks Cindy for your many good posts.

I would just give my 2 cents and my opinion that Forex is NOT a zero sum game but a negative sum game.

Don't forget that each time you win and the other losses, the broker house has taken the spread on both sides. So there are not two players in this game but three instead.
Simplicity is the Ultimate Sophistication.
  • #32
  • Jun 13, 2013 11:56am Jun 13, 2013 11:56am
Quoting broketrader
I agree with what you all said, and thanks Cindy for your many good posts. I would just give my 2 cents and my opinion that Forex is NOT a zero sum game but a negative sum game. Don't forget that each time you win and the other losses, the broker house has taken the spread on both sides. So there are not two players in this game but three instead.
That's right. Because there are 3 parties in every trade, buyer and seller can both win and can both lose, but the broker always win.
  • #33
  • Jun 14, 2013 8:43am Jun 14, 2013 8:43am
i believe when a market participant make an order,
there is always another participant as their counterparty.
even broker take their risk as counterparty if they do dealing desk (act as dealer),
regardless whether they make manipulation.
broker have many advantages -order matching between traders, widen the spread,
or continue some orders to bank.

i think the amount of sellers and buyers are equal, not in person,
but in the quantity which they willing to risk in the market.

when market maker accept to fill an order, it means they accept to carry its risk,
even if there is no opposite order at the moment.
of course, except market order, not of all order can be filled.
in order to reduce their risk they could widen the spread as large as the risk, until another order takes place.
hence, the process of trade is be able to occur.

even market maker can make a loss with accept to fill good order,
but they have some kind of buffers, limitations, and method to avoid their dealers to "sell" the bank,
otherwise turn it into profit.
as a dealer is a good trader.

just want to share my thought, i'm not sure if my views are valid.

regards
steady as she goes
  • #34
  • Jun 14, 2013 8:58am Jun 14, 2013 8:58am
If you are a day trader or scalper then yes it is a giant poker game where every trader does their best trying to collect the chips. In the long run, the chips will gravitate toward those who are the most talented. If you trade a wider time horizon, you are trying to make money off shift in commercial demand for different currencies, capital inflows and outflows and hedgers such as exporters and importers that do not care whether they make or lose money. The latter approach would make more sense as an investor. But I guess most of us here like to capture the quick moves.
  • #35
  • Jun 14, 2013 9:14am Jun 14, 2013 9:14am
No this not true. Please not listen to this. Reason I say is even day trading, swings, or whatever time of period you trade, buyers and sellers are not equal. Maybe today 100 buyers and 100 sellers, maybe next day 150 buyers and only 50 sellers. Lot of money going back and fourth maybe look like between traders, but market is who you bet on. Not listen to this, you bet on market. Market moves other direction where everyone is, that is why so many people lose. Market make money because spread you pay. Warren Buffett buy currency only when market is going down, you see. This is how it is working. Mother tell me market is not the rocket science, just need to be right side.
I making the big monies, so far +10 pips. Follow me if you nice guy...
  • #36
  • Jun 14, 2013 12:36pm Jun 14, 2013 12:36pm
Quoting forexaccent
No this not true. Please not listen to this. Reason I say is even day trading, swings, or whatever time of period you trade, buyers and sellers are not equal. Maybe today 100 buyers and 100 sellers, maybe next day 150 buyers and only 50 sellers. Lot of money going back and fourth maybe look like between traders, but market is who you bet on. Not listen to this, you bet on market. Market moves other direction where everyone is, that is why so many people lose. Market make money because spread you pay. Warren Buffett buy currency only when market...
This is partially incorrect.



For every buyer there is a seller. It is true, for example, that one seller may want to sell 15 contracts and he may be matched up against 15 individuals that want to buy 1 contract each. But there can never be a situation where 15 contracts were sold and less than 15 contracts were bought.



Simply put, every transaction by definition is two-sided.



This, by the way, is the reason there is no such thing as "Bullish or Bearish consensus". If a study comes out and says there are 80% bulls and 20% bears in the market. It simply means they have not asked enough people.
Without VSA, you're playing checkers while the Smart Money plays chess.
  • #37
  • Jun 14, 2013 12:46pm Jun 14, 2013 12:46pm
Quoting HiddenGap
{quote} This is partially incorrect. For every buyer there is a seller. It is true, for example, that one seller may want to sell 15 contracts and he may be matched up against 15 individuals that want to buy 1 contract each. But there can never be a situation where 15 contracts were sold and less than 15 contracts were bought. Simply put, every transaction by definition is two-sided. This, by the way, is the reason there is no such thing as "Bullish or Bearish consensus". If a study comes out and says there are 80% bulls and 20% bears in the market....
What about the volume of orders that haven't been transacted? If there's more willing buyers than sellers, not every buyer will be able to buy, so there would be buyers left over.
Play the players, not the cards.
  • #38
  • Edited 4:54pm Jun 14, 2013 4:37pm | Edited 4:54pm
Quoting HiddenGap
{quote} This is partially incorrect. For every buyer there is a seller. It is true, for example, that one seller may want to sell 15 contracts and he may be matched up against 15 individuals that want to buy 1 contract each. But there can never be a situation where 15 contracts were sold and less than 15 contracts were bought. Simply put, every transaction by definition is two-sided. This, by the way, is the reason there is no such thing as "Bullish or Bearish consensus". If a study comes out and says there are 80% bulls and 20% bears in the market....
Sorry I don't agree. This is not correct. So you telling me when I buy 500,000 lot contract there must be seller or many sellers that is equal to same contract? How is this. Everyday same people buy equals same people sell? No cannot be. Where you get this information? How you know someone is selling 500,000 lot to me at exact price I want when I want. The market has much liquid and can sell you what size you need. Maybe I agree when you make buy some sell to you or looks like that but really you buy or sell from market so it can make spread. Only looks like between two traders because many contracts being buy and sell, but first market gets then put spread then give to you. Some win, many lose, but end market makes money cause spread. Hope make it clearer. Many respect, not to argue with Hidden Gap. Like mother said can't please everyone, but be yourself so that you can be true to self and others. Then respect given.
I making the big monies, so far +10 pips. Follow me if you nice guy...
  • #39
  • Jun 14, 2013 6:13pm Jun 14, 2013 6:13pm
It just ain't that simple, people. As in "there's a buyer for every seller". It isn't
really a poker game. You're dealing with currencies that define the economic
structure of the World.

When anyone says "for every buyer, there's a seller" they're not thinking about
the larger picture. For example; when people cross international borders they
may have their currency exchanged..... central banks may hold/buy/sell huge
amounts of currency..... and on and on it goes. One thing is for sure; If your
name is "Bob" there is no designation that says "George" or "Bill" will lose money
if you win a trade. I hope you get that.
When the Joker is in the deck.. fear not and play it well
  • #40
  • Jun 14, 2013 7:36pm Jun 14, 2013 7:36pm
Of course there are a myriad of potential buyers and sellers buying and selling currencies constantly round the world. In the much smaller universe of the leveraged retail forex trader there is only you and your broker. In the vast majority of cases they are not hedging your tiny bets in the market they just take the opposite side of your trade in the belief that they will usually win. This is where the real money is for the brokers-- not in taking commissions from your trades but in trading directly against you. Anyone who believes the protestations of some of the brokers that they don't do this is being gullible in my opinion. Anyway-it really is a 'zero sum game'-- you are playing directly against an unscrupulous foe-- which should be very motivating--best of luck to everybody!
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