I'd see the key role of these traders, they are helping the market become more volatile than the usual trend we experience. More traders, more market movements. So I expect that the market become more volatile in the future than today due to the growing number of active traders. And that is also the time we need to be more careful and analyze the market situation as well. And the riskier it looks like. But the good about this situation especially when using an exchange that has a huge trade volume is that it is easier it fill our order.
If I am going to ask, I prefer to have a high-volatile market than a low-volatile for this will matter a lot in trading.
Topic: Does number of traders affect volatility? (Read 612 times)
It doesn't directly impact the volatility but it indirectly has an effect on the volatility and as long as we have traders trading Bitcoin we will see the market moving and it can be stopped at only one figure only in one situation wherein all the Bitcoin has been purchased by one person and he is not selling it or else there is a co-ordination between all the trading to paise the trading for certain period of time which is impossible.
The number is not important, but investments. If there were a million traders with amounts of $10 each, they would not have the same impact as 1,000 traders with $200,000 per trader. Therefore, if the traders’ investments were shy, they would not have an impact compared to the income of institutional investors who will move the price strongly and quickly. Investments are good, as retail investors may have an impact, especially since their trades are carried out on the spot-market, where the impact is immediate on the price compared to OTC for institutional investors.
The answer will vary and depend on the size of the investment, not the number of investors.
The answer will vary and depend on the size of the investment, not the number of investors.
If there were 1000 traders and each one made 200k, That is also around 200 million dollars. That's why not all traders have that amount that is entered into the trading exchange, whether it's CEX or DEX. So, it means that the price volume of the market is moving not because of the number of traders, which you said I also agree with.
Because there are others like Micro Strategy that can buy bitcoin worth $200 million, and even other companies like Blackrock can also buy large amounts of bitcoin. It also means that traders have different capital sizes and are not the same.
The number of traders is increasing more than before as more people are generally becoming more interested in ways to become more financially independent and as thus in search of skills like trading.
Does the number of traders directly affect the volatility of the market? If it does, can we assume that trading was easier before with less traders (less volatility) than now when there are more traders, and the market more volatile?
The increasing number of traders has an effect on market volatility. For example, you can see the tokens that are currently hype and those that are going sideways. And you can compare the trading volume. And actually more traders or increasing trading volume is actually a good thing and even for us daily traders, this volatility is what we exploit to get small profits in the near future with the scalping method. And the increasing number of orders on the market also makes transactions easier. But the more volatile the market, the higher the risk. Because sometimes the market becomes more difficult to analyze. But as long as the trend hasn't shown a reversal then it's usually fine. And sometimes Chart Pattern is useful in such markets. looks simple but quite effective. Does the number of traders directly affect the volatility of the market? If it does, can we assume that trading was easier before with less traders (less volatility) than now when there are more traders, and the market more volatile?
Yes, it does affect the volatility but you can't really see it as it's so insignificant anyway that bitcoin's still volatile. The more people there is that's trading bitcoin, the more there is the volatility because some might just be hodling but there's someone out there that's selling and buying and most of the time, there's never any time that no one's not selling at the market, the only way that the volatility could ever be removed is if there's some form of unity that we don't have to sell at this point in time but that's not going to happen.
I would like to say at the outset that unrest is normal where there is a large presence of people. Similarly, in any business, once the business grows, it becomes very difficult to sustain it. Which we can realize through trading. At present we see volatility in the trading business due to over-trading in the trading business. So we can say trading was pretty steady when traders were less.
In crypto, I would say yes. You can even notice it on lowcap memecoins that isn't well known yet. There is no pump yet because there is no volatility in the markets. And volatility come with the interests of other people gathering in of the opportunities. If you want to confirm that there is many participants in the move, then check the volume is high also. But if there is price rally yet volume is low, it means there is small numbers who is buying in large amount. And those are the whales.
The market volatility depends on many issues and concerns, the volume of trade is just one factor.
Yeah definitely bro!I completely agree with that. The volume of trades is one of the reasons why a cryptocurrency becomes more volatile because the more supply and demand there is, the more the volatility would be. Bitcoin is a prime example of this because we have seen how Bitcoin used to be so stable in its initial days where there weren't a lot of exchanges and a lot of people buying and selling Bitcoin which means the volume of trades was very low, but as soon as that volume started going up, the price of Bitcoin started moving up as well.
So undoubtedly, when there are more traders in the market trading a certain cryptocurrency, it will be more volatile because there is more demand for it than other cryptocurrencies, and this will also make its price go up since more people will be interested in buying that cryptocurrency.
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Traders are increasing day by day and people are in search of some good income strategies. Trading has become more popular in the previous couple of years.It surely will affect the volatility of the crypto market as more investors the different will be the interest of investing and the more volatile a project will become.
People have open their eyes on trading, and it has increased the numbers of people to become a traders in the community because they have experienced progress in those that are using it to make money, and never to depend on one source of income again.Since the buyers and sellers are the major people who are in a position to change the price in the market, and they are the ones that caused bull run and bear run in a particular season, don't forget that they use to change from the market because you can't find bull market and bear market at the same time.
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That's not a negative thing we just need to get enough skills to make an investment.volatile market conditions can also give you some very good profits if you can predict the market trend by the skills you gained. So it has a negative effect also but there is a positive one too.
What is keeping traders to remain in profits making is the skill they have before going into trading, and it will not make such traders to miss their opportunity to earn well from the market because they will surely trade during the bull run.
As the day goes by, the population is able to pay, along with the increase in population, all the demands are also increasing. Therefore, the interest of people to trade in crypto currency is also increasing. It is expected that the number of traders will increase as the days go by. Of course, I will say one thing to all traders that it is very important to be successful without being honest and if you check the market and invest, you can definitely become a successful trader.
Day by day people are getting aware about trading and as day goes by the number of people doing trading is also increasing. As the number of people trading in cryptocurrencies increases, this can have an impact on the cryptocurrency market as well. But trading is as risky as it used to be, is still risky, and will continue to be risky in the future. We should understand that trading is actually not that easy. A major reason for this is that your single decision in trading can make or break you financially. Therefore, even if the number increases, it is not like this where people will become skilled very easily and return with a bag of money as soon as they trade. There are very few skilled people in every field of work in this world, I don't think the number of skilled traders is very high among those who are trading in crypto currency market.
The number of traders is increasing more than before as more people are generally becoming more interested in ways to become more financially independent and as thus in search of skills like trading.
Does the number of traders directly affect the volatility of the market? If it does, can we assume that trading was easier before with less traders (less volatility) than now when there are more traders, and the market more volatile?
As the market buy/sell demand increases, that certainly affects the volatility of the market price. Less volatility means less activities in the market. That is why we couldn't make ourselves confident of our strategies that worked in the past as someday this is not effective anymore. Traders make the market more volatile. However, we can say it has a negative impact on the market making it too risky, and should look more into market analysis. But on the other side, this will also help us active traders to possibly earn more every day. Does the number of traders directly affect the volatility of the market? If it does, can we assume that trading was easier before with less traders (less volatility) than now when there are more traders, and the market more volatile?
We need to erase the negative thoughts that forming on our minds, as that can only limit us from doing what we like to do and prevents us from being successful. If not and we fail, that is fine as well, but apart from traders, the investors and those who buy a coin for different purposes, they are also a contributing factor to the intensity of volatility.
The number of traders is increasing more than before as more people are generally becoming more interested in ways to become more financially independent and as thus in search of skills like trading.
Does the number of traders directly affect the volatility of the market? If it does, can we assume that trading was easier before with less traders (less volatility) than now when there are more traders, and the market more volatile?
Does the number of traders directly affect the volatility of the market? If it does, can we assume that trading was easier before with less traders (less volatility) than now when there are more traders, and the market more volatile?
It will increase even more because we are in a bull run now, but of course it still depends on the amount traded by traders. It means that if that is a large amount, let's say that each trader has 100$ each and the number of traders is 1M, which means that 100M dollars will be immediately introduced to the market.
But the question is, are there only 1 million traders that we have in this field of crypto or bitcoin industry in the whole world today? Because each trader does not have the same amount they trade in the market, right? So, there is really an impact on volatility no matter where we look at it.
Amount impacts volatility more than number of traders. If there are 100 people with 100 million dollars versus 100k people with 1 million dollars, then the ones with 100 million will impact it a lot more. Volatility happens when some people buy a lot of bitcoin or sell a lot of bitcoin, which means it all depends on the amount. If there are a lot of people but not a lot of money then how could that impact the price, it usually won't and that is what matters.
I personally believe that we need to make sure that we could move the needle with the amount we are talking about. Don't get me wrong more people usually does mean more money, but it is not a must and even a few people could impact the volatility in the end.
I personally believe that we need to make sure that we could move the needle with the amount we are talking about. Don't get me wrong more people usually does mean more money, but it is not a must and even a few people could impact the volatility in the end.
I agree with your points but I think the number of traders also matters in some cases, let me explain how.
You are right that the amount of money is what impacts the volatility in a market in reality, but when the number of traders is less, that volatility would take more time which means the market would be a bit stable. The reason behind that is, that if there aren't a lot of traders, there wouldn't be a lot of asking and bidding prices, and fewer bids or asks mean more time for the price of an asset to change.
If only 10 people are trading a certain cryptocurrency, you would barely see its price moving up or down much because the number of traders isn't high and even if those 10 people have a lot of money to buy or sell that cryptocurrency, they wouldn't be able to do that quickly because there aren't a lot of people willing to buy or sell that cryptocurrency. Now change that number from 10 to 100 and you will see a big difference.
The number of traders is increasing more than before as more people are generally becoming more interested in ways to become more financially independent and as thus in search of skills like trading.
Does the number of traders directly affect the volatility of the market? If it does, can we assume that trading was easier before with less traders (less volatility) than now when there are more traders, and the market more volatile?
That can somehow contribute to the volatility of the price as every trader have their own strategy and we all have to buy and sell as a trader, and those traders makes the market active 24/7. Though I don’t agree that it is better before where we have few traders because traders create liquidity as well which is very important in the market. The market volatility depends on many issues and concerns, the volume of trade is just one factor. Does the number of traders directly affect the volatility of the market? If it does, can we assume that trading was easier before with less traders (less volatility) than now when there are more traders, and the market more volatile?
There's strength in numbers, but I don't know if the saying has anything to do with cryptocurrency traders nor it having anything to do with volatility.
One fact is that the more the number of traders willing to trade at the time, is the more congested the network will be.
The factor that drives price is demand and one person can demand a lot more than even 20 people could demand and if there aren't more traders willing to sell, how will this quota of demand be met?
Also, an investor who is interested in owning BTC may decide to buy some and keep and that's one distinction between being an investor and a trader. Even if the investor occasionally swaps or spot trades before withdrawal, so long as it is not a constant practice, he or she doesn't really qualify in my context, to be called a trader.
I think the size or number of trades at a certain frequency, has a lot to do with volatility as compared to the size or number or traders.
One fact is that the more the number of traders willing to trade at the time, is the more congested the network will be.
The factor that drives price is demand and one person can demand a lot more than even 20 people could demand and if there aren't more traders willing to sell, how will this quota of demand be met?
Also, an investor who is interested in owning BTC may decide to buy some and keep and that's one distinction between being an investor and a trader. Even if the investor occasionally swaps or spot trades before withdrawal, so long as it is not a constant practice, he or she doesn't really qualify in my context, to be called a trader.
I think the size or number of trades at a certain frequency, has a lot to do with volatility as compared to the size or number or traders.
Amount impacts volatility more than number of traders. If there are 100 people with 100 million dollars versus 100k people with 1 million dollars, then the ones with 100 million will impact it a lot more. Volatility happens when some people buy a lot of bitcoin or sell a lot of bitcoin, which means it all depends on the amount. If there are a lot of people but not a lot of money then how could that impact the price, it usually won't and that is what matters.
I personally believe that we need to make sure that we could move the needle with the amount we are talking about. Don't get me wrong more people usually does mean more money, but it is not a must and even a few people could impact the volatility in the end.
I personally believe that we need to make sure that we could move the needle with the amount we are talking about. Don't get me wrong more people usually does mean more money, but it is not a must and even a few people could impact the volatility in the end.
Does the number of traders directly affect the volatility of the market? If it does, can we assume that trading was easier before with less traders (less volatility) than now when there are more traders, and the market more volatile?
I would like to say at the outset that unrest is normal where there is a large presence of people. Similarly, in any business, once the business grows, it becomes very difficult to sustain it. Which we can realize through trading. At present we see volatility in the trading business due to over-trading in the trading business. So we can say trading was pretty steady when traders were less.
The number of traders is increasing more than before as more people are generally becoming more interested in ways to become more financially independent and as thus in search of skills like trading.
Does the number of traders directly affect the volatility of the market? If it does, can we assume that trading was easier before with less traders (less volatility) than now when there are more traders, and the market more volatile?
Does the number of traders directly affect the volatility of the market? If it does, can we assume that trading was easier before with less traders (less volatility) than now when there are more traders, and the market more volatile?
I actually don't see it that way, the higher numbers of traders in the market doesn't affect the volatility of the market, what I think that affect the volatility is the market cap, if the market cap is high, their wouldn't be much volatility, but if the market cap is low, the volatility will be very high, that's why shit coin gives more roi than Bitcoin or Ethereum.
And another thing I think that easily moves the market is when those institute and the bigger boys enters the market, at that time, for sure the volatility will be very high, but it doesn't happen that often and it's just happen in a short period of time.
The number is not important, but investments. If there were a million traders with amounts of $10 each, they would not have the same impact as 1,000 traders with $200,000 per trader. Therefore, if the traders’ investments were shy, they would not have an impact compared to the income of institutional investors who will move the price strongly and quickly. Investments are good, as retail investors may have an impact, especially since their trades are carried out on the spot-market, where the impact is immediate on the price compared to OTC for institutional investors.
The answer will vary and depend on the size of the investment, not the number of investors.
The answer will vary and depend on the size of the investment, not the number of investors.
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