Market Forces (Real mode v Practice Mode)

Market Forces

When you spend some time in the markets, you will soon come to realise that everyone is there to make money. They have their own agenda as to how they will accomplish it. Some are just an average punter, some professional punters, owners and trainers, bookies reducing their liability, traders, matched bettors, automated bots, and a lot more.

Money moves the markets, pure and simple. But, it is the forces behind the way in which that money is used which ultimately decides which way the market will go. When an exchange user decides to enter the market, they have generally used a variety of information sources to help make their decisions. There can also be sudden and often unexpected events which can influence the markets, such as a horse playing up in the stalls, or the star player picking up an injury before or during the match.

Time also plays a part. Depending on whichever sport you are trading, you will find that timescales also affect the behaviour of that particular market a lot differently than other sports. The profile of the event also causes contrasts. Generally the higher the profile of the event, the more liquidity it will attract. Television coverage generally draws a lot more attention from the crowds too.

Put all of this together and you’re on your way to understanding how the markets could potentially behave, albeit there are never any guarantees in trading. You simply collect and analyse the information, then decide if you wish to enter your money or not.

When you put your money into the markets, your money is a force, not matter what size of stake you use. The size of the stake you choose to use may or may not create momentum within the market. As an example, if you use £2, it is still a force, but not as big as someone using £1000 stakes in the opposite direction. However, if 500 people were to place their bets of £2 each at the same time as you at the same odds in the same direction, then that would have the combined force of £1000.

Whilst using practice mode, your stakes have no bearing whatsoever on the markets, they do not create any forces or momentum no matter which size of stake you use. Practice mode is only really there to help you test an idea and to help you learn.

With practice mode, you can still see the market signals. Say you placed £1000 on a back bet in practice mode, it has absolutely no impact on what the market will do next. But if you were to use £1000 in real cash, your money becomes a market force. You could potentially change the entire dynamic of the market. Say another trader has entered a trade for “x” amount of money. It starts to move the market in a certain direction. You then enter your £1000 in the opposite direction, which might signal to other traders/bots that there is confidence in the market so they all jump on with you, driving through the first traders £1000, pushing him/her into a losing position, they subsequently exit their position. Now if you did the same entry using practice mode, again since the practice cash has no effect, you might find that the market continues to move in its same original direction based on the other traders £1000 of real cash.

Unfortunately, due to the amount of variables involved in trading in practice mode, nobody can actually say for sure that had you been in real cash mode, no matter how small a stake you were using,that it would or would not have influenced the market to behave in your favour. Whilst using practice mode, yes, it can be a good indication that you are starting to read the markets correctly, which in-turn will help with building your confidence. However, do not become over-confident i.e. 100 successful trades in a row using £2 stakes on practice mode DOES NOT mean go launching straight in with big dough when you transfer over to live-cash mode.




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