How does the operator wash the market, what are the methods of washing the market, grasp the psychology of the operator, and avoid being washed out to achieve great results? Today, I will clearly explain it to you in a long article; click to read slowly.
Generally speaking, the purpose of washing the market is to force out weak-willed retail investors in preparation for the upcoming rise.
The methods of washing the market can mainly be divided into:
1. Smash-style washing
Method: Suddenly place a large sell order on the market or directly smash the price with a large order.
Characteristics: Significant short-term decline, panic emotions, sudden increase in trading volume.
Purpose: Force panic sellers and stop-loss orders to give up their shares, filtering out holders.
Operational details:
Quickly break through key support levels, such as moving averages and previous lows, to create panic.
During the smashing process, buy back some at a low price.
Often accompanied by fake news and FUD (fear, uncertainty, and doubt) being released simultaneously.
2. Horizontal consolidation washing
Method: Repeatedly consolidate within a range, harvesting short-term traders back and forth.
Characteristics: Price fluctuates slightly up and down, gradually decreasing trading volume, and extended time.
Purpose: Exhaust short-term funds, causing the impatient to sell off their holdings.
Operational details:
Often quickly bring the price back down after a local rise, creating a “false breakout” to trick both bulls and bears.
Prolonged periods make holders feel “hopeless,” causing them to automatically give up their shares.
3. Spike-style washing
Method: Suddenly drop sharply with a long lower shadow in a very short time, then quickly pull back.
Characteristics: The candlestick pattern shows a “spike” (long lower shadow), and the price returns to its original position or close to it.
Purpose: Quickly shake off stop-loss orders and create a moment of panic.
Operational details:
Typically, spikes are accompanied by on-chain order cancellations, liquidity disturbances, and other operations.
The operator supports at the bottom, and after washing out the shares, continues the original trend.
4. News-based washing
Method: Use negative news and panic public opinion to create psychological blows.
Characteristics: Retail investors are in a panic, actively selling off.
Purpose: Accelerate the washing out of holders and reduce selling pressure during the rise.
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