🧠 What happens when a whale or an institution buys?
When a whale or an institution enters a purchase, they are not simply "buying" like a retail trader. They are shifting liquidity, altering the market structure, and often influencing the behavior of other traders.
Here’s what happens:
1. Silent accumulation
The entry often occurs in sideways phases, not during a full pump. Whales do not buy at the highs: they accumulate silently, distributing orders to avoid moving the price too much (accumulation phase).
2. Volume spike and driven breakout
When the accumulation level is complete, they push the price above a resistance, causing an artificial breakout. This triggers FOMO and market orders from retail traders.
3. Liquidity created by retail
Whales use small traders to generate secondary liquidity: they enter first, drive up the price, and then sell part of their position to those who enter late.
4. Control of the narrative
Institutions often influence sentiment through news, social media, or collaborations. If BlackRock buys, it is not just for value: it is to push the market where they want.
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💡 Conclusion for traders:
When you see unusual volumes and "too clean" breakouts, ask yourself:
Is it FOMO… or is someone loading up?
Whales do not play randomly: they read market psychology and use retail traders as fuel.
Understanding this puts you on the right side of the trade.
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