Definition. Trading by algorithms that place, modify and cancel orders in fractions of a second. It accounts for a large share of the volume in futures and equity markets.
How it works
HFT firms use very fast connections and servers located close to the exchange. Many act as market makers, providing liquidity; others exploit short-lived price differences.
Example
Orders in the book appear and disappear faster than a human can react. That's largely algorithmic activity.
What to watch out for
An individual trader doesn't compete with HFT on speed. Their edge may lie in context, patience and a longer decision horizon.
You'll find the full explanation with graphics, examples and exercises in the 🖥️ Order flow atlas space, and its use in the live market in the 🔴 Live Room. Both are available to Club members (in Polish).
