Cryptocurrency Market Manipulation Phases
1. Accumulation: Strategically gathering funds, waiting for the right opportunity
During accumulation, the market maker uses price suppression, sideways movement, and price increases to create panic or induce weak hands to sell, patiently waiting for market changes to act.
2. Wash Trading: Removing weak hands and solidifying the base, preparing for a price surge
The key to wash trading is to use controlled areas or shakeouts to instill fear in holders, shaking off followers in preparation for the price increase.
3. Price Surge: Capital drives rapid increases, attracting retail investors to chase higher prices
After accumulation and wash trading, the market maker drives the price up quickly using capital and skill, enticing retail investors to chase in, leading to substantial profits for the market maker.
4. Distribution: Selling high to exit, leaving retail investors to bear the risk
When the price is high, the market maker plans to distribute, often selling at high points to induce retail selling, spreading rumors, and creating volatility, leading retail investors to take on the risk as the market maker exits quickly.
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