Discussing the article: "Creating a market making algorithm in MQL5" - page 4
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And guess where the price will go - against MM, or in the direction of his orders?
And in general, if a company, or a bank, or a private person is a MM, then from what motivation of charity?!
Don't laugh at MM's slippers.
MM's function is to make the price attractive for a small speculator by narrowing the spread.
Further - to provide liquidity (which, in turn, reduces volatility), including for small speculator.
Further - price quantisation (price stabilisation) - throwing small speculators out of the market.
Strange as it may seem, "ejection of small speculator" is "price stabilisation". Well, just like in the example with flat and imbalance in it.
MM used, on the basis of "spread narrowing" - "price attractiveness", his liquidity in the flat in order to compensate the imbalance. Had he not used it, the price would have come out of the flat - would have been more volatile. In other words, he restrained volatility with his liquidity. Then he leads the price out of the flat, either with a false movement and return to the flat, or with continuation - without return. That demolishes the stops of both those whose counteragent he was and those who stood against his orders. He leaves the market - with a profit, they - with a loss. He, at this stage, does not come out with a big profit, he is a scalper, so to say (at this stage). And his takes are the stops of his counterparties.
But he takes the price out of the flat boundaries not as sharply as it would go out without him, but with a return to the flat boundaries and bounces, or with a return to the flat....
Actually... MM organises the flat by injecting its liquidity and restraining the price movement))))))
But the thing is that he trades his liquidity with all types of players.
So, if narrow spreads and liquidity attract a small speculator, who is then thrown out of the market. Why do you need MM?!
What, in your opinion, is its purpose?
Yes, the price will go in his direction. But he doesn't need sharp pumps and dumps either. Try to be a MM yourself on DEX, and see how the capital sharply jerks on sharp pumps and dumps. It is much more profitable to have a stable flat and cut the spread, isn't it?