Sure but what if someone else is doing something in the market that perfectly lines up with the edge conditions for your place and cancel thresholds? Nothing is

Sure but what if someone else is doing something in the market that perfectly lines up with the edge conditions for your place and cancel thresholds? Nothing is foolproof. If you are operating at a large enough scale this will end up happening a few times a day, especially when you have multiple agents interacting in ways that can't be predicted. A feedback loop can still happen between two unrelated traders running similar rules like "if I'm not the best offer, improve it by a tick".