The market's rollercoaster ride of pumping and dumping often stems from the strategic maneuvers of big players known as "whales." Here's a simplified breakdown:
1. **Whale Games:**
- Whales, with their deep pockets, play a high-stakes game of manipulation.
- They inflate prices (pump) by buying up large volumes and creating hype.
- Once prices peak, they swiftly sell off (dump), cashing in on profits.
2. **Psychological Tug-of-War:**
- Traders, driven by emotions like FOMO, jump in during pumps, further fueling the frenzy.
- But when the tide turns, panic sets in, leading to mass selling and price crashes.
3. **Liquidity Tricks:**
- Whales exploit liquidity zones, where lots of orders are clustered.
- By triggering these orders with sudden price swings, they profit from the chaos.
Understanding these maneuvers can help traders navigate the stormy seas of cryptocurrency without getting swept away by the whales' games.
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