When a currency with a relatively or absolutely low price suddenly experiences a large decline in volume, it is a key market signal. Usually, behind this phenomenon, there are often hidden strategies and market psychology games of the dealer.
The dealer's operation in the market is often purposeful and planned, especially when the price of the currency is already low, they may use the large decline in volume to wash the market and re-position. Specifically:
Washing and chip cleaning: When the price of the currency is already relatively low or extremely low, the dealer may attract retail investors who blindly buy the bottom by creating a trend of large decline in volume. The purpose of this behavior is to clean up the profit and lock-in of the previous high-position holders, and also to clear the short-term speculators in the market.
Market psychology game: Large declines in volume often trigger panic and emotional reactions in the market, causing retail investors to sell their positions in panic. At this time, the dealer can use low prices to absorb more chips and reverse the trend when market sentiment reaches a low point.
Signal of trend reversal: When the price of a currency has experienced a round of shrinking volume and a large decline at a low level, if it can be observed that the market begins to see an increase in buying or the price begins to stabilize and rebound, this is often a signal that the dealer is about to launch a reversal. At this time, firmly holding or appropriately increasing positions may bring subsequent profit opportunities.
Therefore, in the face of a sudden large decline in the volume of a currency at a relatively or absolutely low level, investors should remain calm and rationally analyze market dynamics. If you are still watching and cannot see the market trend clearly, it will only fall due to bullishness and rise due to bearishness. Free ➕👗 ➕🌍 BNB0098
Unless there is a sudden strong negative news, this situation is likely to be operated by the dealer to accumulate energy for the subsequent reversal upward. In such a market, patience and determination not to be washed away will be the key to victory.