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

  • #41
  • Jun 14, 2013 9:02pm Jun 14, 2013 9:02pm
Quoting forexaccent
{quote} 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....

when someone make order, bank or broker fills its order as opposite/counterparty.
whenever you make order buy, bank would become seller to you.
if there is no seller to you, then how can a trade would occured?

i think liquidity is the key.
would you explain how one currency pairs become liquid and not liquid?
steady as she goes
  • #42
  • Jun 14, 2013 9:04pm Jun 14, 2013 9:04pm
Quoting Slim Buffett
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...

exactly,
when someone cross the border he need exchange (he sold his currency and buy foreign currency).
he becomes seller of his currency and the money exchanger becomes buyer of his currency. and vice versa.


but, i don't have clear picture with central banks policy (money supply, interest rate, etc).
it's just my assumption (ass-u-me).
i suppose when they do quantity easing, at the time there is no change in their exchange rate.
but, when someone does exchange (whatever his purpose-speculate or just exchange),
exchange rate starts to change.
the more exchange occur, the more change in exchange rates may happen.
relates to expectation towards CB policy.
steady as she goes
  • #43
  • Jun 14, 2013 11:33pm Jun 14, 2013 11:33pm
Quoting frz
{quote} when someone make order, bank or broker fills its order as opposite/counterparty. whenever you make order buy, bank would become seller to you. if there is no seller to you, then how can a trade would occured? i think liquidity is the key. would you explain how one currency pairs become liquid and not liquid?
Liquidity simply refers to ones ability to transact.
Time hides Nothing
  • #44
  • Jun 15, 2013 7:53am Jun 15, 2013 7:53am
Quoting CindyXXXX
{quote} Liquidity simply refers to ones ability to transact.
yup, it's right.
steady as she goes
  • #45
  • Jun 15, 2013 2:27pm Jun 15, 2013 2:27pm
Quoting GnarlyPips
{quote} 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.
This would push price up until willing sellers were found. So it is the relative willingness of either the buyers or sellers that causes price to move up or down repectively.
When you hear somebody say the market was down today because there were no buyers or a lack of buying, this not completely true. Every price represent a transaction. And every transaction is two-sided (a buyer and a seller). What caused the down move was the relative enthusiasm of the sellers with respect to the buyers.


A price chart represents orders filled (transactions made). Let's suppose that in your example all the buyers are using limit orders. If price moves away without filling all the orders, those unfilled orders remain. It is possible that price would move up and never move back down to where these limit orders are. But this would have nothing to do with the limit orders as they are only transacted at the predetermined price. Therefore the fact that there were more buyers (but not market participants) makes no difference.
Without VSA, you're playing checkers while the Smart Money plays chess.
  • #46
  • Jun 17, 2013 12:34am Jun 17, 2013 12:34am
Quoting frz
{quote} would you explain how one currency pairs become liquid and not liquid?
No.
I making the big monies, so far +10 pips. Follow me if you nice guy...
  • #47
  • Jun 17, 2013 1:26am Jun 17, 2013 1:26am
what difference does it make.
  • #48
  • Jun 17, 2013 1:55am Jun 17, 2013 1:55am
Quoting frz
would you explain how one currency pairs become liquid and not liquid?
Well, I can. I mean, it wasn't me who first discovered it, but the main features of how the liquidity is formed were very well described in a book 'The Undeclared Secrets That Drive the Stock Market' by Tom Williams.

To cut a long story short, it's us (people) versus the big players (market makers). If you want to be successful in trading you'll have to study how those guys think, what do they do and learn how to take a free ride on their tail each and every time they find that 'hidden liqiudity' (or should I say FORM that liquidity) at our expense. I mean, someone's gotta pay and it's not going to be them, otherwise the 90-10 rule wouldn't even have evolved and those big players would've been out of the business.

I'll set an example that's very well known by many of us, market junkies. It's a scene from the 'Wall Street' movie, when Gekko instructs Fox to purchase first blocks of the Anacot Steel stock, then inform his buddies of the stock going up and make a call to the media to tell the person who picks up the phone 'Blue Horseshoe loves Anacot Steel'. The rest was history. And that was how the liquidity for a particular stock was formed, furthermore that was how millions were made within short period of time risk-free what was even more important. He had his ride on Larry's tail. So I assume, maybe we all should take that type of a ride at least at times. And I'm not even talking about the insider trading, I'm talking about finding that liquidity on a constant basis (or close to constant, since one cannot simply be right all the time) so to make sure we bet on sure things. At least that is how I approach betting (betting of financial markets is no exception, since after all betting is betting) because I hate losing.

Hopefully this post gave you a glimpse of the market at a different angle and the information mentioned above could be somewhat useful to you, because as Gekko the Great once said 'The most valuable commodity in the world is information'.
Blue Horseshoe loves Anacot Steel. - Wall Street, (1987)
  • #49
  • Jun 18, 2013 11:30pm Jun 18, 2013 11:30pm
Quoting Ishtana
I think I'm on a very questioning mode on everything about trading. You've read books, plenty of them, but they didn't help your bottom line. So logic says, the books just might be wrong. And I think we need to question everything to find out the truth ourselves. So here's another common teaching that I partially don't really agree with. "For someone to win/lose, someone else has to lose/win." That's literally true. Say there are 4 little people. And for the sake of originality, let's call them A, B, C, and D. A opens a 1 lot long on EU. For this...

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

yes,,,,,,,,,,,,,forex is a zero sum game, like futures.
if there is something you should keep secret,simply just save it,, so, just
  • #50
  • Jun 19, 2013 5:03am Jun 19, 2013 5:03am
Quoting sandycarrot
{quote} Every time you win, someone else loses, and vice versa? yes,,,,,,,,,,,,,forex is a zero sum game, like futures.


I've read,,somewhere,,,

Forex, the speculative market acts the same as the futures market. Yes, it is true that you can actually aquire physical currency, but that’s not what you’re doing when you trade spot forex. Technically, spot forex trading operates the same as futures, though on a very short duration basis. If you buy USD/JPY you are technically making an agreement to exchange JPY for USD in two business day’s time at an agreed upon price. Of course you won’t actually do that, just like most futures traders will never take or make delivery on the positions they run. That’s where the rollover comes in to forex trading. Your broker essentially offsets your open position, closing it out, and enters a new position – all done at the current market rate. In some brokers this is very clearly done, especially when you’re talking about interbank trading.

Most retail brokers don’t really work that way, though. Instead, when you buy USD/JPY you actually borrow JPY, convert it to USD and deposit the USD, with the guy on the other side of the trade doing the inverse. That’s where the interest rate differential comes in. Again, you have a situation where any gain you make is a loss for the other guy, and vice versa because you both have a requirement to repay the respective loans you have taken out. It’s not as if you could actually take the USD you bought and walk away.

One way or another, there is always someone with an opposite position to you matching your trade. If your broker cannot directly offset your position against another internal account, it will do so in the market.

forex is a zero sum game, like futures.
if there is something you should keep secret,simply just save it,, so, just
  • #51
  • Jun 19, 2013 5:14am Jun 19, 2013 5:14am
If that were true,being we are in the biggest bull market run in stocks (which is where all the middle and working class are in, not futures and forex) then we would have wiped out 1/2 the countrys wealth by now. Yet almost EVERYONES 401k IS STUFFED TO THE MAX right now like never before. So dont believe that. Oh...and who is losing all the money that this stock market wealth created? ALMOST NOBODY!!!!!


I think this example should wake a lot of people up to that theories stupidity. Its not even so in day trading where they claim theres always someone else "on the other side of your trade" but its definitely more so and more prevelant there. The longer the time frame the less relevant it is. Why? Theres too many answers.
  • #52
  • Jun 19, 2013 5:53am Jun 19, 2013 5:53am
dear all,
please notice that money is not traded for money in most part of the world
i , for example, trade my money for food, electricity, clothing, etc,
if you all just see the money, i am a net looser, 100 % ....

best regards,

myself

ps: sorry if someone ever read this anywhere else, but it is just a thing that i learn from other.
  • #53
  • Jun 19, 2013 9:28am Jun 19, 2013 9:28am
If you trade and loose than somebody will take this profit. It's true. This is just a rule of the game. Doesn't metter where do you trade marketmaker or ECN because anyway it should be counterparty for you trade.

If you physically convert euro to USD and USD will go up against euro than you will be loosing money in USD amount BUT you still have you initial eur amount. Simple but means a lot. When you trade forex one day you can have nothing one day because of margin call.
  • #54
  • Last Post: Jul 13, 2013 3:21pm Jul 13, 2013 3:21pm
Every time you win, someone else loses, and vice versa?

No not necessarily , example : I bought cable at 1.6 from A then sold it to B at 1.61 , i made money yes but A and B could be winners as well , if someone paid me for something more than what i paid for it , it doesn't necessarily mean he lost ! This is a market ...
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