Forex 4 Less

[Eryn]

Youcould write part of the prompt above the mormal command line, instead of using a two line prompt. In a sense, it would be one normal line, and one printed above - outside the normal prompt area (it would require the terminal escape sequences for cursor control).

That would cover the less case by writing over the last output line, as you suggested.

But it would also write over the output of other commands - many of which do not have more output that just this line.

Even the most intelligent people are susceptible to the markets great lure; the constant flashing of prices, the constant short-term moves on five minute charts and the constant rush of adrenalin that trading provides can be nearly impossible to ignore.

Accept that you have no control over the market, and let it do its thing. You only have control over yourself as you trade, and the best way you can help your chances of trading success is by removing yourself from your trading platform most of the time.

People who start their trading life with the false notion that they must be in touch with the markets throughout the trading session, soon realise that it is a losing proposition. A novice trader will do well if he complies with the advice given in your article.

Hi Nial, always great to read what ever you write because you are always spot on, I have just minimize my profits today, trying to be smart and get in and out on my trade, only to make stupid mistake ,I will set and forget, from now on and take your advice from this lesson

Nial ive listened and learnt so much from you over the past 3 years or so , your blogs and lessons are so easy to follow and you talk my talk common sense , you dont confuse trading and its all beginning to come together and make sense , ive had a rough time but youve given me a new lease of life and hope for the future , keep posting your timely lessons they are life changing , thanks for being there !!!!

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Turnover in global foreign exchange (FX) averaged more than $7.5 trillion per day in April 2022 amid a volatile market environment. Compared with the previous BIS Triennial survey in 2019, trading volumes were higher because of greater activity in short-maturity FX derivatives and more inter-dealer trading. By contrast, trading with customers stagnated, mirroring a slowdown in international investment in 2022. A greater share of trading was executed via various bilateral methods, rather than via multilateral platforms that make prices available to all participants, implying that the transparency of the FX market may have decreased further. 1

Turnover in global foreign exchange (FX) markets reached $7.5 trillion per day in April 2022 (Graph 1, panel A),2 a volume that is 30 times greater than daily global GDP.3 The Triennial Central Bank Survey of over-the-counter (OTC) foreign exchange turnover ("Triennial Survey") offers a glimpse into this vast FX market. This year in April, data collection coincided with heightened FX volatility due to a confluence of factors, such as changing expectations about the paths of future interest rates in major advanced economies, rising commodity prices and geopolitical tensions after Russia's invasion of Ukraine.

Global FX volumes were higher compared with the previous Triennial Survey in 2019, owing to two main drivers. First, more trading in short maturity FX derivatives, which mechanically increases turnover, under the assumption that many contracts are rolled over. And the greater use of short maturity derivatives may reflect market participants' aversion to taking on term risk in a more volatile environment. Second, more inter-dealer trading, which tends to rise with volatility. In fact, the rise in inter-dealer turnover was big enough to reverse the long-term trend of a declining inter-dealer share in global FX trading. By contrast, dealers' trading with financial customers stagnated, mirroring the slowdown in international financial investment activity.

Trading with hedge funds and principal trading firms (PTFs), and the associated prime-brokered turnover, also declined, suggesting some reduction in activity by non-bank financial intermediaries in the FX market.

The share of FX trading using various bilateral methods, where information about the trade remains private, has increased. This reflects both inter-dealer and dealer-customer trading shifting away from multilateral platforms. In the inter-dealer market, trading volumes executed via electronic brokers, where trade attributes such as prices can be seen by all participants, have thus continued to decline. The notable shift towards bilateral forms of trading in 2022 implies a continued reduction of "visible" trading and increased market fragmentation, suggesting that the transparency of the FX market may have decreased further.

The remainder of the feature starts with a bird's eye view of long-run trends. This forms the backdrop for discussing the Triennial results obtained this year amid more volatile markets than during previous surveys. The last two sections delve deeper into the dealer-customer and inter-dealer market segments.

While more than 50 currencies trade globally, FX trading activity is concentrated in a few trading hubs and major currencies. The Triennial captures sales desk activity in 52 jurisdictions for 56 currencies. Yet, close to 80% of all FX trading takes place in the five FX trading hubs that are major financial centres. Furthermore, as the pre-eminent vehicle currency, the US dollar was on one side of around 90% of all FX trades in April 2022 (see Box A), a share virtually unchanged for decades.

FX trading involves both spot and derivatives, with the share of spot having been on a gradual decline over the last 10 years (Graph 1, panel B). FX swaps are the most traded FX instrument and their share increased from around 40% in 2013 to more than 50% in 2022. They are typically used by market participants to take positions, manage funding liquidity in different currencies and hedge currency risk.4 Forwards are the third most traded instrument,5 used mainly to hedge currency risk or to bet on future currency movements. Their market share has edged up gradually over time.

The FX market can be broadly characterised as consisting of a dealer-customer and an inter-dealer segment. Such a two-tier structure is typical of OTC markets, where dealers warehouse risk and serve as counterparties, ie provide liquidity, to end users. Inter-dealer trading volumes used to exceed trading volumes with customers until about two decades ago due to inter-dealer trading of inventory imbalances.6 Thereafter, various structural changes resulted in relatively less inter-dealer trading (Graph 1, panel C). Examples include more efficient inventory risk management and "internalisation", whereby dealers match customer flows on their own books.

But the distinction between the core inter-dealer and dealer-customer market segments has become somewhat blurred over time. This reflects a proliferation of multilateral trading venues, a growing variety of execution methods, and some non-bank actors emerging as liquidity providers alongside dealers. Especially in spot markets, principal trading firms (PTFs) have become important. PTFs rely mostly on speed and automated trading strategies rather than balance sheet capacity to support their market intermediation activities. As they have morphed into liquidity providers to customers, PTFs have become an integral part of FX intermediation and a key determinant of liquidity conditions.

Comparing the results of the 2022 Triennial with the 2019 Survey is complicated by very different market environments. The 2019 Triennial covered a month in a period of subdued and falling volatility in FX markets. And ultra-low interest rates supported intermediation and liquidity provision in FX markets. The 2022 environment looks very different. Especially important for the FX market this year was the high and uncertain inflation path, driving rapid but globally diverging monetary tightening. The Russian invasion of Ukraine led to further uncertainty and market turbulence. These developments had a profound effect on international capital flows and financial market volatility, including that in currency markets.

To get a better sense of the relationship of volatility and turnover in FX markets, we benchmark the Triennial with higher-frequency series.7 This allows us to compare changes in turnover not only over three years but also on a month-by-month basis.

The higher-frequency benchmark shows that turnover increased in tandem with FX volatility in the early part of 2022 (Graph 2). At close to $8.5 trillion per day, turnover in March 2022 is estimated to have exceeded even the prior peak during the Covid-19 financial market turmoil in March 2020. In July and August this year, some divergence between volatility and turnover emerged when exchange rate volatility continued to rise while turnover did not.

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