Why does the price move? The answer is here!!! - page 13
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I wonder... how many originals I'll be in this thread ;))))))))))))))
with the answer to the question: Why does the price move? - by the chart !!!
Nope, that's right: by what - on the chart, and why - pokachanu :D
The introductory phrase was "starving" and "hungry for both". That's the good thing about rice. The rest is all other things being equal. But that's not what the anecdote is about, so try to focus on the essentials rather than the details, which are never enough for all cases.
So, now I'm interested - how does the price move?
Thousands of banks are sending reports to a centralised server (CS) every second about their bank's foreign exchange transactions? And the CA already generates a price based on that data?
it's amazing how people try to trade without any understanding of the nature of the object of trade) i.e. forex.
Although, one can do it without understanding, I agree, "I buy for 2000, sell for 5000 and live off these 3% (Percentage)" (from the anecdote))
No, it is much simpler than that. Banks sell and buy currency from their customers.
I would make a correction: banks buy and sell customers' currency, they close cross orders (Oh my God!!! COOKING!!) that's where it appears to be coming from :))) and the difference is either in the position or in the market, depending on the situation, the situation Vita outlined above
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I remember the moment:
97, the eve of August 24, Nenka's Independence Day, about 9 pm, Reuters terminal :)
USDUAH... A frenzy!, Quotes went crazy, activity was crazy (though not for a long time :)))
Shaw?! (seeing who's quoting) it's Friday :))) dealers are drunk and celebrating the holiday :))
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to Korey: it was the only time you could get real meaningful information from forex volumes :) you could clearly see by the volume who got drunk the most ))
The price movement is like the law E=mc "2, a rough example, but the energy in the system is also roughly constant. If there were ideally two traders in the market, then if one trader would earn $100 today, then the second would lose $100.
Long ago at school we attended a business centre and back then we were taught capitalism in the former Soviet Union, and there was a game that was not quite accurate, but its essence was as follows. The group was divided into two teams. Some were called Bulls (those who are taller and dumber, okay, just kidding), and the others were clearly Bears (Cows, something goes wrong). Terms are equal initially, all standing, talking, smiling, at a signal game begins, comes down to the following, you come to the table take a card on it the price, if you're a bull, you have to sell it, and the bear opposite takes a card from his table and tries to buy, maybe not quite adequate representation of the bulls and bears, but the bottom line is that the difference between the deal one bull and bear recorded each his benefit. Ideally, the longer the game lasts the random factor decreases and the trader's direct activity works. Of course in this game one has to be a complete cow to lose, but still the results are orders of magnitude different when the price difference is 10 points.
Of course, that's not the answer, I'll correct myself a bit, the price is indeed driven solely by supply and demand and at some point when trading activity is high and thousands of people decide to buy something the price of that good rises if its supply is much lower, on a global scale that's a matter of seconds.
...others (Cows, what's up) clearly Bears. Conditions are equal initially everyone is standing, talking, smiling, at the signal the game begins, it boils down to the following, you come to the table take a card on it the price, if you bull, you have to sell it, and the bear opposite takes a card from his table and tries to buy ...
О! I'm the Cow. I don't get it...
So is there a redistribution of cards with prices between the two groups of players? Or is the price in this game somehow quoted based on player activity?
Help in short people ... You don't have to comment, just give me a link at least...
http://putnikfx.narod.ru/DeepFX.htm
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?
and you don't get it! - it's for COLLEGE))
Well, so I'm a mu-smart Cow:-) - I'll do my best!
No, it is much simpler than that. Banks sell and buy currency from their clients. Up to a certain degree, which is set by the bank's internal regulations and perhaps by the restrictions of the national Central Bank, banks take the risk and grow the position (short or long). As soon as the size of this position exceeds the established limits, then the bank takes measures to mitigate the risk. In the trivial case, the bank buys (or sells) currency from another bank in order to close a normatively risky open currency position. It so happens that large banks have large limits on the open foreign exchange position, hence large banks are caving in big and buying foreign exchange from large banks. There are few centralised systems that bring banks together and make it easier for them to trade currencies. This is where the price is born. The quotes from these systems become the source of quotes for the rest of the world. No one sends any reports anywhere. But if, for example, UBS quietly, outside the system, buys a couple of billion francs from Deutcshe banka, the price of the transaction remains outside the system, unbeknownst to anyone. However, no one can afford to do that anymore.
Where is the server? How does it get the information? From which banks? All of them?
The scheme - from the transaction at the bank, to the price on our monitor. What is it?
1. thousands of banks send information about their trades to the central RBS server, which is located in the basement;
2. The server processes the received information and sends it to the DC servers, which have signed an agreement with RBS;
3. Servers of brokerage companies - with taking into account their spread - send the price information to our computers.
Right? RBS (Royal Bank of Scotland) is the head of a consortium of western banks.
Or, as you say, several centralised systems? Then the DCs will get their prices from them? So there are many centralised servers? Therefore it is impossible for me, as a hacker, to control forex price formation?
Where is the server? How does it get the information? From which banks? All of them?
The pattern - from the transaction at the bank, to the price appearing on our monitor. What is it?
1. thousands of banks send information about their trades to the central RBS server, which is located in the basement;
false
2. The server processes the received information and sends it to the DC servers, which have signed an agreement with RBS;
false
3. Servers of brokerage companies - with taking into account their spread - send the price information to our computers.
false
Right? RBS (Royal Bank of Scotland) is the head of a consortium of western banks.
Or, as you say, several centralised systems? Then the DCs will get their prices from them? So there are many centralised servers? So it is impossible for me, as a hacker, to control forex price formation?
True, impossible :)
You want data about trades - control SWIFT and put a filter on MT300 :))))
SZZ: read Piskulov at least, you will have an idea of how banks work.
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By the way, the payment systems have the most real information on the most real transactions, their volumes, etc., the results of which we see on our monitors as charts