On cryptocurrency exchanges, including Binance, there is a whole spectrum of users with different trading approaches. Some manage large capitals, while others have small deposits. However, the market is structured in such a way that large players, known as whales, often use their strategies and power to influence traders with smaller assets.
Who are the 'whales'? 🐋
Whales are traders or companies that manage huge sums of money. Their goal is to maximize profits by manipulating the market. They hold large volumes of coins or capital, allowing them to dictate their terms by moving the price up or down.
For whales, small traders become part of their strategy. Small deposits are most often influenced, as novice players lack deep knowledge and do not understand how market mechanisms work.
How do they identify traders with small deposits? 🔍
1. Order analysis in the order book
Whales often monitor the order book, where buy and sell orders are visible. Small traders usually place small orders that stand out against the backdrop of large orders.
2. Trade volumes
Large players can use data on average trade volumes in a specific market. Small volumes are a clear sign of traders with small deposits.
3. Reaction to price movements
Small traders often panic in response to sharp price jumps, buying at peaks or selling at drops. Whales deliberately create volatility to 'squeeze out' small players.
4. Liquidation data
In the futures markets, information about liquidation of positions is visible to all. Large players can use data on liquidations and stop-loss levels to force small traders to close their positions at a loss.
Whale strategies against small traders 🎮
1. Price manipulation
Large players can artificially 'move' the price. For example, they place large buy or sell orders to create the illusion of demand or supply, and then sharply change the direction of the price.
2. Liquidity gathering
When whales see small orders in the order book, they may trade to 'take' this liquidity, leaving small traders without favorable prices for a trade.
3. Fake orders
Whales often place large orders in the order book, creating the illusion of interest in a certain direction. Small traders react to this, thinking that the market is indeed moving in that direction, but the orders are then canceled.
4. Stop-loss hunting
Whales know that beginners often place stop-losses too close to the current price. They move the price into these zones to trigger stop orders, then return the price to previous levels.
How can small traders protect themselves from whales? 🛡️
1. Avoid trading on emotions
Panic is your enemy. If you see a sharp price movement, stop and think; it could be manipulation.
2. Don't place stop-losses at obvious levels
Large players often target zones where many stop-losses are located. Place them so that they are not too close to the current price.
3. Look at the volumes
Study trading volumes. If there suddenly appears a large volume in the market, it could be a signal of manipulation.
4. Diversify your deposit
Do not invest all your money in one coin or strategy. This will reduce the risk of losses.
5. Trade with cold calculation
Always analyze the market and avoid acting under emotional influence. The less chaos in your trades, the harder it is for whales to exploit you in their strategies.
Conclusion 🎯
There will always be whales in the market trying to exploit small traders for their benefit. However, by understanding their strategies, you can avoid traps and protect your assets. The key is to learn, analyze the market, and remain calm. Remember that even with a small deposit, it is possible to earn steadily if you act wisely and with an understanding of the market. 🚀