How should retail investors respond to a washout?
🟨Hold onto bottom chips
When faced with a washout by the market makers, retail investors should avoid panic selling, especially when holding low-cost tokens. Methods to determine the bottom area include:
🚩Chip concentration: The concentrated area of bottom chips is usually the cost zone of the market makers.
🚩Turnover rate: A turnover rate exceeding 200% over a period of time may indicate the cost range of the market makers.
🚩Volume accumulation: The average price of accumulated trading volume often approaches the cost of the market makers.
🚩Large orders pressuring: When large orders appear on the order book, it is usually at the cost position of the market makers, and after the pressure, prices often rise.
As long as the retail investor's holding cost is lower than that of the market maker, there is no need to worry about being washed out.