Why does the price move? The answer is here!!! - page 14
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The price does not move. The price is moved (that's right, the price itself won't go anywhere) by people (definitely people, not aliens from the zeta net) creating different supply and demand for different currencies.
To predict price behaviour, you need to predict people's behaviour.
In order to predict human behavior, one must predict how people will react to certain events.
In order to predict how people will react, it is necessary to predict what will happen.
Since it is difficult to predict events, then:
1) events can be planned and carried out independently (e.g. a terrorist attack like Bin Laden),
2) you can create a filter on the way the event -> information -> society (i.e. a big information collector like RBC, Reuters) and use the information before it becomes widely known.
P.s.: Do you know how banks trade on the forex? You don't know? Well, let me tell you.
Bank X receives a currency conversion order from a large company for Y billion dollars.
Bank X makes a currency exchange transaction on the interbank market for an amount of Y + Q, where Q is the bank's own funds, an amount normally equal to one-tenth of Y.
Then a large company for which an exchange operation is performed receives the required currency, and the bank profits from income on position from its own funds as a result of a powerful price jump caused by a change in the supply/demand balance due to conversion of a tidy sum.
That's the secret of banks ;-) Take it in stride!
Can I see where they publish such data without "extra" zeros? Give me the link please.
Information about future quotes and pending orders - it's like in the story about the hay that is better to be laid knowing where, but only few people know and they are not interested to write about it in newspapers or on personal portals
What's the point of a bojan? Programmers don't need to understand the backdrop and reasons for market movements. They do not need to. Programmers look for statistical patterns. And those patterns (if any) do not give a damn about the causes of market movements. Example: The Russian government has decided to increase its gold reserve by $1,000,000,000. :) You found out about it. Market law: you can't buy that much at once. There is simply no place to buy it. So it will be bought in portions. And for a long time. The price will rise accordingly. So: you know the reason, you know the law. And how can you use it when writing an indicator? Statistically it's a meaningless situation. It happened once and it may never happen again.
Books, I've read too. Of course I haven't read all of them, but I don't think you have either. So books are books, but even books don't tell the truth. I'd say it's 50/50.
The result would be an inconsistent system that would satisfy me and, I think, many people on this forum!
As one of my teachers used to say: "Books are not only useful and useless, but also harmful" :)
I too have spoken out on this forum on the issue raised in this thread. Look at my posts starting with this one. Maybe you'll get something out of them.
Bank X receives a currency conversion application from a large company for Y billion dollars. - Suppose, although it is very rare phenomenon in the Forex market, that the bank offered no other methods for its client to get hold of several billions and decided to execute the order directly. Let us assume that neither the depth of the bank's economic thought, nor the variety of banking instruments will save the situation and we have to go out into the market and trade foreign exchange.
Bank X makes a currency exchange transaction on the interbank market for an amount of Y+Q, where Q is the bank's own funds, usually this amount is equal to one tenth of Y.- The bank does not need to enter the market with its own funds in order to heat the client up on Q on the difference in price before and after the intervention Y. And actually entering the market with Q of your own money for the sake of speculation is a very risky idea. If one wants to speculate at risk, then the transaction will have to be executed in the opposite direction as well, at the peak of the price, after the intervention with client funds in the amount of Y. For, as a result of the reset of Y in the market very quickly sellers/buyers will be washed out at a price close to the current price, the market will become "thinner" and easily "shifted" in the direction of the intervention. Once there, the price can easily return to its pre-intervention direction. In a market shifted by intervention it is very difficult to make large transactions, because there will be far fewer people willing to buy at a price that suddenly became expensive (or sell at a price that suddenly became cheap) than in a quiet weaving market. Understand, no one is a fool, everyone understands the rules, that after the plummet of Y billion, the price went up, for example, and there is a sea of those who want to sell at a higher price, but the buying side is also not stupid, and also understands that the reinforced army of sellers, without bread, will return the market to the place where the pre-intervention interests meet in a comfortable environment. I presume everyone has seen such magical shifts by a few figures with a swift return straight back. It is therefore possible for the bank to stand against the client as well.
Then the large company on whose order the exchange operation was carried out gets the currency it needs, and the bank profits from the income of the position from its own funds as a result of a powerful price spike caused by a change in the supply/demand balance due to the conversion of a tidy sum.
That's the secret of banks ;-) Take it in stride!
О! I'm the Cow. I don't get it...
So is there a redistribution of price cards between the two groups of players? Or is the price in this game somehow quoted based on player activity?
The cards are taken from the table like cards. With a large number of approaches to the table, the probability gets blurred... You can only take one card.
The price is written on the card.
I have 10 I am a seller and you are a buyer you have 5 cards we agreed on 8, in the end I -2, you -3 (two cows :))
that's all, everything else depends on yourself, for example I do not like to get -2 I will look for a buyer with whom I could agree to 11-14 (14 was the maximum) Here you stand before the choice to spend time and get a profit or dump quickly bad and catch good, very instructive game :) even today
in the book
Christopher A. Farrell's Day Trading Online
you can find out why the stock markets move
It's very detailed there.
I think the technology is the same in the currency markets.
PS. I tried to attach the book does not work.
If anyone needs the book I can try to email it to you
http://monetarism.ru/search.pl?topic=6
http://video.google.com/videoplay?docid=-5939744990469662594
in the book
Christopher A. Farrell's Day Trading Online
you can find out why the stock markets move
It's very detailed there.
I think the technology is the same in the currency markets.
I didn't think I'd get to the "Why Price Moves" books.
Geez...
Daisy-chamomile.
smoking weed, very nervously.
I'm going to ramble a little, sorry.
In the early days of trading in Russia, when we didn't yet have Forex, we used to have the fun of trading with our fingers on the floor. Imagine a crowd in front of a stage, and on the stage, a showman dancing with a hammer.
From the stage: "Lot number ... - voucher for sale - 1,000 pieces - at 22.5".
Twenty-eight fingers in the audience say "I'll sell too" and 35 say "ready to buy".
From the stage: "and at 22,6 ?"
From the audience, 30 fingers say "I'll sell" and 33 fingers say "ready to buy".
From the stage: "at 22.65 ? ".
From the audience, 31 fingers - "sell", 32 - "buy".
The showman hammers the tablet with a shkwark! "deal!" (1 slot off the board + 31 sell = 32 buy). And a quote of 22.65 appears on the board, well as in the charts nowadays. And so on and so forth, and clients are informed by mobile phones about the course of trading and they order "buy if from .... to ..." or "sell if from ... and up to ...". And clients are nervous, so the price dances.