New market making algo in action

consider this:

lots of people use volume for decision making as it is popularised quite a bit and seem to provide some edge. As technology now here, algos can be programmed to take money from these players. :D
 
Quote from logic_man:

So the entity which is executing the algo is taking both sides of the trade to make the volume seem to be elevated? Not sure how that's going to make anyone any money, but maybe I'm missing something. I don't think that deploying an algo with the sole purpose of "messing up" someone else's volume-based signals is actually a way to make money.

If that's not what's happening and there are trades happening between two parties, I don't understand how that isn't "true" volume.
More...

Hi,

Old thread but interesting subject. Thought I'd offer the following:

Large trades could be randomly exchanged at the bid/ask with the sole purpose of artificially masking any usable volume information.
If there were only one institution doing it they would filter out their own interference noise and retrieve the usable genuine information.
Of course if anybody else also did their own interference... then nobody could retrieve the original info. Which suggests (to me) it may be a self defeating practice.
Very interesting though.

On a related question:
Do institutional players know the identity of the parties in any trade in the futures market? In real time?

Thanks
- ras72
 
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