Most transactions on the stock market are done with computers and not with people behind the screens. A good example is when I did a minor order to do some tweaking of my portfolio, and got the following execution on something that only trades 1000 shares a day:
01/19/2010 14:28:28 Bought 100 of XXX @ $XX.XX
01/19/2010 14:27:23 Bought 100 of XXX @ $XX.XX
01/19/2010 14:26:16 Bought 100 of XXX @ $XX.XX
01/19/2010 14:25:10 Bought 100 of XXX @ $XX.XX
See the pattern? The computer probably had an algorithm that said “sell 100 shares, space each order at the bid 66 seconds apart until you’ve cleared your order”.
Algorithms that trade against each other fundamentally are playing rock-scissors-paper against each other in order to scalp profits against those who have the weakest or easiest to predict algorithms.