In the cryptocurrency market, 90% of people lose money due to whale manipulation. Understanding these market tricks is the key to determining the winners and losers.
Let us reveal how whales steal your funds and teach you how to avoid their traps. 🔽🧵
Whales’ Trading Patterns
You may already be aware that whales and insiders play a major role in manipulating market trends and moving the market. However, most people don’t notice how often these manipulations occur.
The whale's trading style usually includes the following stages:
1. Accumulation
2. Accumulate again
3. Price increase
4. Allocation
5. Redistribution
6. Price reduction
By studying these patterns, we can identify eight common manipulation strategies used by big players.
Eight manipulation strategies
1. Trailing Stop
Big players will find clusters of stop orders around key price points and then push price into those areas with large buy and sell orders, triggering stops, liquidating small traders, and creating rapid price movements.
2. Fair Value Gaps (FVGs)
FVGs are significant price movements and clear chart gaps caused by aggressive market activity. For example, after a strong advance, prices often pull back. This can benefit big players and trigger stop losses for crypto traders.
3. Spoofing
False quote strategies involve placing and quickly canceling false orders to mislead traders and automated systems, influencing price trends and making detection difficult.
4. Wash Trading
Whales who engage in self-trading typically move cryptocurrencies between different accounts to create the illusion of high trading activity and demand. Although prohibited in stock markets, self-trading is very common due to the unregulated crypto market.
5. Two-sided market
Big players place large orders on both the buy and sell sides to manipulate prices up and down. Small traders can only trade in one direction and will be eliminated by violent price fluctuations.
6. Manipulating price range
The price usually breaks through the upper or lower band after 4-5 hits. Big players often push the price, lowering their entry cost and causing some traders to sell at a loss. If the price rebounds after reaching a key point, this is likely manipulation.
7. Turn off jaw mode
Whales place large buy and sell orders at the closing price to influence the market direction. The falling buy wall and rising sell orders compress the price, trapping retail bulls and favoring bears.
8. Create fake trends
Whales can influence chart movements by buying at resistance levels or selling during upward corrections. This manipulation distorts patterns, misleading retail traders who rely on patterns for market judgment, creating false signals and steering market movements.
in conclusion
By understanding and identifying these strategies, you will be better able to navigate market volatility and protect your funds from whale manipulation. Remember, knowledge is power, especially in the cryptocurrency market.
