Maker

<h4>As seen on most trading platforms, these <a href="https://www.altcoinbuzz.io/?s=whales" target="_blank" rel="noopener">whales</a> always interfere with the market. They tend to set up news stories that help them out, which leaves regular traders open to problems. </h4> 
For instance, the recent buzz about <a href="https://www.altcoinbuzz.io/?s=Mt.+Gox" target="_blank" rel="noopener">Mt. Gox</a> moving their BTC has scared people about quick payouts. It led to significant sales and price drops, allowing whales to buy more BTC at cheaper prices. Let’s discover more about this market maker manipulation. 
<h5>1) The Way Whale Tricks Work</h5> 
The good news is that whale tricks follow patterns you can spot. By looking at these patterns, traders can better understand how whales work. The typical cycle goes like this: 
<ul> 
 <li>Accumulation: Whales buy up enormous amounts of cryptocurrency without making any noise. They often do this over a long period to keep prices from increasing.</li> 
 <li>Pump: Once they have enough, they start buying a lot more, increasing the price.</li> 
 <li>ReAccumulation: As prices climb, they keep buying. It helps push the upward trend even more.</li> 
 <li>Pump: Another significant price surge occurs as more traders jump on the bandwagon.</li> 
 <li>Distribution: Whales start selling off their holdings at peak prices, distributing their coins to retail traders.</li> 
 <li>Dump: After selling a large part, they create a selling frenzy, driving prices down.</li> 
 <li>Redistribution: When prices drop, they start selling their remaining assets.</li> 
 <li>Dump:&nbsp; The last sell-off often drives prices lower than the levels seen before the initial buying.</li> 
</ul> 
<img decoding="async" class="wp-image-146263 aligncenter" src="https://www.altcoinbuzz.io/wp-content/uploads/2024/07/xvcdsfdf-216x300.png" alt="" width="456" height="633" srcset="https://www.altcoinbuzz.io/wp-content/uploads/2024/07/xvcdsfdf-216x300.png 216w, https://www.altcoinbuzz.io/wp-content/uploads/2024/07/xvcdsfdf-303x420.png 303w, https://www.altcoinbuzz.io/wp-content/uploads/2024/07/xvcdsfdf.png 390w" sizes="(max-width: 456px) 100vw, 456px"> 
<h6 style="text-align: center;">Source: <a href="https://x.com/JoinCryptoToday/status/1811050484826001506" target="_blank" rel="noopener">X</a></h6> 
Knowledge of these phases will enable traders to watch for Whale movements, which may not be their exit liquidity. 
<h5>2) Spoofing the Market</h5> 
Whales enter into massive buy or sell orders to manipulate other traders. For instance, a large buy order might generate optimism and compel traders to start buying. When prices go up, the big player cancels the buy order. These fake orders may lead to an outburst of emotions among traders, leading to wrong decisions. 
<ul> 
 <li>How to steer clear:&nbsp; You can avoid the rapid market changes resulting from fake orders by placing limited orders. Don’t let large buy or sell walls dictate your trading decisions. Often, these are temporary and meant to mislead.</li> 
 <li>Two-Sided Market:&nbsp; Whales place large orders on both sides of the market. They might position a large buy order at a lower price and a large sell order at a higher price. As prices move toward the large buy order, they create a positive feeling. Prices approaching the sell order create a negative sense.</li> 
</ul> 
<img decoding="async" class="wp-image-146265 aligncenter" src="https://www.altcoinbuzz.io/wp-content/uploads/2024/07/dfdsffdsdfs-194x300.jpg" alt="" width="447" height="692" srcset="https://www.altcoinbuzz.io/wp-content/uploads/2024/07/dfdsffdsdfs-194x300.jpg 194w, https://www.altcoinbuzz.io/wp-content/uploads/2024/07/dfdsffdsdfs-272x420.jpg 272w, https://www.altcoinbuzz.io/wp-content/uploads/2024/07/dfdsffdsdfs.jpg 389w" sizes="(max-width: 447px) 100vw, 447px"> 
<h6 style="text-align: center;">Source: <a href="https://x.com/CryptoBenderr_/status/1815455574433337694" target="_blank" rel="noopener">X</a></h6> 
<h6>How to avoid it</h6> 
You can steer clear of it by keeping an eye on big orders on both ends of the market. It may suggest an attempt at manipulation. You can also avoid it by not giving in to the whale’s behavior and not making hasty trade decisions based on quick price fluctuations due to big orders. 
<h5>3) Wash Trading</h5> 
Large players engage in transactions with other large players to give the market the appearance of being very active when, in reality, it is not. This fake volume can trick other traders into thinking the asset has potential, pushing them to buy. 
<h6>How to avoid it</h6> 
Check <a href="https://www.investopedia.com/terms/b/bid-askspread.asp" target="_blank" rel="noopener">the bid/ask spread and order book activity</a> to get actual liquidity. You shouldn’t only rely on volume metrics. Volume is easy to manipulate, so use other indicators to assess the market. 
The second part of this article is a continuation of this topic. 
<a href="https://www.patreon.com/altcoinbuzz" target="_blank" rel="noopener"><img decoding="async" class="aligncenter wp-image-124240" src="https://www.altcoinbuzz.io/wp-content/uploads/2023/09/image-7-1-1-300x37.jpg" sizes="(max-width: 714px) 100vw, 714px" srcset="https://www.altcoinbuzz.io/wp-content/uploads/2023/09/image-7-1-1-300x37.jpg 300w, https://www.altcoinbuzz.io/wp-content/uploads/2023/09/image-7-1-1-1024x127.jpg 1024w, https://www.altcoinbuzz.io/wp-content/uploads/2023/09/image-7-1-1-768x95.jpg 768w, https://www.altcoinbuzz.io/wp-content/uploads/2023/09/image-7-1-1-696x86.jpg 696w, https://www.altcoinbuzz.io/wp-content/uploads/2023/09/image-7-1-1-1068x132.jpg 1068w, https://www.altcoinbuzz.io/wp-content/uploads/2023/09/image-7-1-1.jpg 1197w" alt="Coins" width="714" height="88"></a> 
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<h6>Disclaimer</h6> 
The information discussed by Altcoin Buzz is not financial advice. This is for educational, entertainment, and informational purposes only. Any information or strategies are thoughts and opinions relevant to the accepted risk tolerance levels of the writer/reviewers and their risk tolerance may be different than yours. We are not responsible for any losses you may incur due to any investments directly or indirectly related to the information provided. Bitcoin and other cryptocurrencies are high-risk investments so please do your due diligence. Copyright Altcoin Buzz Pte Ltd. 
The post <a href="https://www.altcoinbuzz.io/bitcoin-and-crypto-guide/market-maker-manipulation-how-to-avoid-it-part-1/">Market Maker Manipulation: How To Avoid It – Part 1</a> appeared first on <a href="https://www.altcoinbuzz.io">Altcoin Buzz</a>.

Market Maker Manipulation: How To Avoid It – Part 1

Altcoin Buzz

Alte articole publicate pe 23 iul. 2024

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