Exploiting whales in the market (i.e. large investors or entities that control the market movement due to their large trading volume) requires smart strategies and a deep understanding of the market. Whales usually benefit from their great influence on price movements, but if you can recognize their patterns, you can benefit too.
1. Order Flow Tracking
Whales can make a big impact with their large trading volume. You can monitor market liquidity or use tools like order book and volume data to determine where the market might move based on their movements.
How to profit: When you notice that there are huge moves in a particular market, try to enter in the same direction or just before the whales to take advantage of the big move.
2. Understanding the impact of macro time frames
Whales usually trade over large time periods (such as a week or a month), where they place huge investments.
How to benefit: Focus on larger time frames to identify long-term trends, then look for opportunities on smaller time frames to enter the market at strategic moments.
3. “Buy rumors and sell facts” strategy
Whales often influence news or events that lead to large price movements. They often make huge moves based on rumors or before major news is announced.
How to profit: Anticipate market movements before important news or events and enter trades based on technical analysis and past market results.
4. Monitoring gaps
Sometimes, whales may move the market suddenly, resulting in price gaps on the charts (which is the difference between the closing price and the opening price of the next trading day).
How to profit: You can watch for price gaps and trade based on the likelihood of covering them or profiting from price movements after the gaps.
5. Extensive market analysis
Whales don't just move in one market, they can influence several markets at once (such as currencies, stocks, commodities).
How to benefit: Following their movements in different markets will enable you to find trading opportunities by moving between markets.
6. Continuous monitoring of liquidity
Whales prefer highly liquid markets, where they can buy and sell large quantities without significantly impacting the price.
How to profit: Look for times when liquidity is high in your preferred markets, where price manipulation can be less obvious, allowing you to take advantage of market movements without significantly impacting your strategy.
7. Predicting Reversals
Whales may buy or sell in large quantities when they expect the price to reach a certain level, leading to price reversals.
How to profit: If you notice that the market has reached strong support or resistance levels, and the whales start moving in the opposite direction, you can follow these moves and profit from the price reversals.
8. Analysis using advanced tools
There are tools like the Accumulation/Distribution Volume Indicator and the Relative Moving Average (RSI) that can help identify when whales start accumulating or distributing in the market.
How to profit: Use these tools to confirm that there are certain trends in the market that indicate that whales have started to accumulate or distribute assets.
9. Beware of whale traps
Whales may try to “prey” on small traders by manipulating the markets, resulting in fake moves.
How to benefit: Be careful not to enter into trades based on sudden moves that are not supported by solid evidence. Strategies such as deep technical analysis and knowledge of market fundamentals can help you avoid these traps.
10. Stay prepared for big swings.
Whales can cause extreme volatility in the markets at times, especially when they decide to liquidate their investments or enter into huge trades.
How to benefit: Use stop loss and take profit orders to reduce risk in situations of high volatility.
Trading with whales can be profitable if you are able to understand their movements and react to them carefully. It is important to learn how to determine the right time to enter and exit trades, based on careful analysis of the markets.