You are foolishly trapped above, big players are offloading first Still thinking that an old saying from Bao will lead to offloading
First, understanding the diagram below will let you know that the top should be capped This can roughly show the game between the main force and retail investors
1. Chip Concentration: How to Understand and Interpret
Chip concentration is a measure of the concentration of long and short positions in the market. It intuitively reflects the strength of the market's dominant forces. • Long Chip Concentration (Green): • Thin Column: Represents a high concentration of long chips, meaning that most tokens in the market are held by a few institutions or market makers. These institutions can more effectively manipulate the market and push prices up, making it easier to inflate prices. • The longer and more concentrated: As the column lengthens, it indicates that the long force is stronger and the chips are more concentrated, which is a positive buying signal. • Short Chip Concentration (Red): • Thin Column: Represents a high concentration of short chips, meaning there are a large number of short positions concentrated in a few accounts in the market. • The longer and more concentrated: As the column lengthens, it indicates that the short force is stronger, and the market may face more selling pressure, which is a cautious selling signal.
2. Whale Position Volume: How to Use in Combination
The whale position volume chart shows the amount of funds held by large players (i.e., whales) in the market. This data can help us understand the distribution of funds in the market, but it cannot directly tell us the comparison of long and short forces. • Position volume increases: Indicates that the long or short position volume in the market is growing, usually related to the market's leverage effect. When position volume increases, it may mean that more leveraged trading is happening, but it cannot independently determine long or short. • For example, when long position volume increases, it may indicate that more funds are flowing into the market, strengthening the long position, but it may also mean higher short pressure.
The next part continues ~ 3. How to use chip concentration and position volume data in combination