1. *Data Collection:*  

AI systems gather massive amounts of market data — prices, volume, news, social media sentiment, financial reports, etc.

2. *Training Models:*  

They use machine learning (ML) models, like neural networks or decision trees, trained on historical data to recognize patterns: price movements, breakout points, volatility changes, etc.

3. *Prediction and Decision-making:*  

Once trained, the AI predicts market movements or identifies opportunities (buy/sell signals). Some models react in milliseconds (called high-frequency trading or HFT).

4. *Execution Automation:*  

Many AI systems don't just recommend trades — they execute them automatically, way faster than a human could.