That may seem like a funny question and many forex traders aren’t approaching their daily trading routines worried about how many forex robots they have to compete against on a daily basis. When you get down to it, don’t you and your own forex robot have enough to worry about besides thinking about the other forex robots out there?

It is easy to understand why some forex traders may wonder if there are too many forex robots trading in the currency markets. After all, all you need to do is type the term “forex robot” into any Bing, Google or Yahoo and you’ll come up with a dizzying amount of search results. So many in fact, that would take a normal person hours to scour each one.

But does a lot of forex robots being on the market and a lot of forex traders using forex mean anything for the real overall flow of the market? Do the forex robots that are available to retail traders have the capability to actually influence the trade in highly liquid pairs like the euro/US dollar (EUR/USD) and dollar/Japanese yen (USD/JPY)? When you hear the answer, you probably won’t be surprised.

Forex 101: The Most Liquid Market In The World

You have probably heard that forex is the most liquid of all the financial markets in the world. That is true and that is due in large part to the fact there are no central exchanges like there are for stocks and bonds to interfere with the flow of forex orders. Of course, liquidity in forex trading is also due in large part to the fact that it is the only market that is open 24 hours a day. Traders in the U.S. can start trading as early as Sunday afternoon when the Tokyo/Sydney session opens and trade all day every day until the New York session closes on Friday afternoon.

Due to the hours of the forex market, a ton of money changes hands on a daily basis. Some estimates say $2 trillion a day. Other estimates say $3 trillion on a daily basis. Regardless, either amount is more than all of the world’s stock and bond markets combined. Let’s split the difference and assume that $2.5 trillion is traded everyday in the forex market. Do you really think that a forex robot that you buy for $100 can impact the price of any currency pair?

Market Participants Affect Forex Robots…Sort Of

The great thing about the massive liquidity in the forex market is that it makes very difficult for any market participant to have a lasting impact on any currency pair. Even the world’s central banks, which are among the biggest players in the market, can only affect the price of a pair for a few minutes. And these banks have billions of dollars to play with. We’re not saying a forex robot can’t compete in the market, we’re just saying a million robots couldn’t affect prices the way you think they should.

Author Bio: Francisco Pizarro G. made a career from Forex and left my profession as a Translator almost 4 years ago; since then I work from home in my small office trading the Asiatic markets during night time, where I found a good niche. I am a fan of Forex Robots

Category: Finances
Keywords: Forex Robots, Day Trading, Forex, Forex Brokers, Finacial Advisors, Expert Advisors