Navigating the cryptocurrency market with ease, learning to distinguish whether the main players are conducting wash trading or quietly unloading is a necessary lesson for every investor. Here are some practical judgment techniques:
1️⃣ Closely monitor trading volume: Changes in trading volume are key to understanding the intentions of major players. A significant decrease in trading volume may indicate that the main players are washing out, intending to clear out floating positions in preparation for a subsequent rally. Conversely, if trading volume suddenly spikes, this may be a sign that the main players are selling off in large quantities, indicating unloading.
2️⃣ Carefully observe price trends: During the process of driving up the price, major players usually conduct wash trading after reaching an increase of about 30% to solidify the gains and attract more following investors. However, if the price increase exceeds 60%, investors should be highly cautious, as this may signal that the main players are preparing to unload, possibly wanting to cash out at a high point.
3️⃣ Thoroughly analyze the intraday chart: Fluctuations on the intraday chart can also reveal the intentions of major players. During wash trading, the intraday chart often shows significant volatility, with prices bouncing up and down, creating a false perception of market instability to scare off weak-willed investors. In contrast, during unloading, the intraday chart may appear relatively stable, with reduced price fluctuations, as major players try to maintain price stability to facilitate a smooth unloading.
In summary, to establish oneself in the cryptocurrency market and avoid being manipulated by major players, mastering these techniques is crucial. Do not overlook these seemingly small details; they can often help you protect your investments at critical moments and ensure steady asset growth.