What are the disadvantages of AI trading?

In seeking to understand the complexities of AI trading, it is essential to acknowledge the potential drawbacks that accompany its advantages. Could you elaborate on some of the key disadvantages of utilizing AI in trading? For instance, do AI algorithms lack the human ability to sense market nuances and interpret data beyond purely statistical patterns? Additionally, are there concerns regarding the potential for AI trading to exacerbate market volatility, as they often act in unison based on similar algorithms? Furthermore, what challenges arise in terms of regulation and oversight, given the rapid evolution of AI technologies? Understanding these limitations is crucial for investors and traders alike as they navigate the increasingly AI-driven financial landscape.