The term crypto whale is used to refer to large investors in the cryptocurrency market. It plays an important role and has the ability to strongly impact the market to make a profit. Therefore, small investors are often worried and looking for ways to “swim” with this crypto whale. Let’s learn more about Crypto Trading through the following article!
Learn about the concept of crypto whale and how to read the chart
crypto whale is a term used to refer to individuals or organizations that hold a large amount of tokens. With a trading volume that can reach millions or billions of dollars. For example, Bitcoin Whale refers to entities that own over 1,000 BTC. It has a trading capacity large enough to fluctuate the price of Bitcoin.
Due to their large influence on the crypto market, most whales usually limit their regular trading on exchanges. Instead, they often trade assets through OTC (over-the-counter) to minimize the risk of price fluctuations when buying and selling crypto.
How to read Crypto charts?
To read Crypto charts, you need to understand the basic components of a candlestick chart, which include the candle body and the candle wick. The candle body shows the opening and closing prices for a given period of time. While the candle wick shows the highest and lowest prices reached during that period. Green (or white) candles indicate rising prices, while red (or black) candles indicate falling prices.
In addition, you need to be familiar with candlestick patterns such as Doji, Hammer, and Engulfing candles to identify market signals. Combined with technical indicators such as RSI, MACD, and moving averages, you can analyze Crypto chart trends and make smart trading decisions.
In addition, understanding heatmap crypto will also help you understand the market better. Heatmap in the cryptocurrency field is a visual tool that helps display the fluctuations of virtual currencies in the market. Through a color palette, Heatmap allows users to easily recognize changes in the prices of currencies.
See more: Capture fluctuation volatility trading professionally
How to get the hang of investing in Crypto Whale?
To learn how to invest like a crypto whale, you can follow these steps:
- Market Research and Analysis: Understand the factors that affect cryptocurrency market prices and trends. Use technical and fundamental analysis tools to make informed investment decisions.
- Track Whale Activity: Use large transaction and wallet tracking tools to spot whale activity. Sites like Whale Alert provide information about large transactions on the blockchain.
- Diversify Your Portfolio: Like the whales, diversify your portfolio to reduce risk. Invest in different cryptocurrencies instead of focusing on just one.
- Use OTC Trading: If possible, trade over the counter (OTC) to avoid price fluctuations on the exchange. This also helps protect your identity and trading strategy.
In addition, when you see a change in the Crypto market situation. Knowing fakeout will help you analyze the market and adjust. Because Fakeout often causes confusion and disappointment for investors. Therefore, they can be tricked into trading based on this fake signal.
Some of the ways Crypto Whale works
So now you understand what a crypto whale is. Then continue to learn about Whale’s activities below:
Main Mode of Operation in Crypto Trading
According to research by industry experts, the crypto whale has a very good ability to grasp market psychology and knows how to take advantage of the FOMO (fear of missing out) psychology of small investors.
Whales will use their huge capital to buy and own a large number of coins. They will create an impulse and push the coin price up, stimulating the FOMO psychology of small investors. Because of fear of missing out on the opportunity to make a profit, these investors will rush to buy. This will make the coin price increase even higher. At this time, whales will sell to make a profit.
Some of the notable tricks of crypto whale
Let’s say crypto whales are famous experts in financial investment. They can also attract attention by constantly mentioning a certain coin to attract the attention of investors. A typical example is Elon Musk, who pushed the price of Dogecoin to an all-time high with just a few tweets in early 2021. This caused investors to rush to buy after observing the Crypto chart.
In addition, whales can also create fake trends by selling a large amount of coins from an address. This causes the price to decline. When investors worry about the market going down and sell, the coin price will drop sharply. At this time, the crypto whale will “buy at the bottom” to buy and wait for the coin price to go up to sell for profit.
Ways to Spot Whales on Crypto Trading
So is there any way to detect crypto whales? The answer is yes, read some Whale signs below:
Recognize crypto Whale is being bought
- Look for a Suspicious Increase in Pending Buy Volume: Check the order book if you see any unusual signs in the market. If the Pending Buy Volume is high or someone wants to buy a large amount of coins. This could be a Crypto Whale about to join.
- Look for large price fluctuations in a short period of time: Normally, a coin will have slight fluctuations. But if its price suddenly fluctuates greatly, it is likely that Crypto Whales are enter the market.
- Look for a sharp increase in buy volume compared to sell volume: In a normal crypto market, the number of pending buy and pending sell orders is quite balanced. However, if the pending buy volume increases sharply. It can be up to 90% of the orders are in favor of buying, which is a sign of a Whale appearing.
Recognize Sell-Offs on Crypto Trading
Observe and recognize Whales about to sell a large amount of coins. This will help cryptocurrency investors limit losses without having to hold coins for a long time. Signs to recognize Crypto charts are as follows:
- Watch for large pending buy order cancellations: When a large volume of pending buy orders is suddenly canceled. This could be a sign that a Whale is about to appear and prepare to sell a large volume of coins.
- Watch for extremely strong gains in a short period of time: If a coin has a strong gain without any news or events. It could be a sign that Whales are pushing the price up. When the price reaches a certain level, Whales will sell a large amount of coins to make a profit.
- Watch for a sharp increase in trading volume: If there is a sudden increase in trading volume in the market, it is likely that Crypto Whales are about to appear and participate in trading.
Highly Effective Strategies for Swimming with Crypto Whale
“Swimming” with the crypto whale is a strategy for retail investors. Aiming to take advantage of short-term market trends. This includes both bullish and bearish trading. However, the core of crypto investing is still buying low and selling high. Therefore, the following section will focus on the bearish trading strategy to accompany the crypto whale.
Choose the coin that is falling sharply on Crypto Trading
To execute this strategy, it is necessary to identify a coin that is in a strong downtrend on the Crypto chart. The characteristics of this coin include:
- Prices fell from the peak by more than 20% – 30%.
- Decreases very quickly and recovery is similar.
- Continuous reduction in just a few days.
- There are many negative rumors in the market.
However, to avoid trading junk coins, investors need to note:
- Only choose coins in the top 30 based on Coinmarketcap rankings.
- Analyze coin price history to identify and accurately catch the bottom.
Buy coins low and sell on a slight recovery
When you are a retail investor and want to “swim” with the Crypto Whales, determining the right time to buy is very important to achieve success. To execute this strategy, you can use RSI analysis.
- Appropriate entry point: RSI falls below 30.
- Sell profit point: RSI rises above 70.
See more: Open an Bybit account – explore the crypto exchange
Notes when applying the strategy of crypto whale
When implementing the “swimming” strategy with Crypto Whales, retail investors need to follow the following principles to ensure effectiveness:
- Only trade coins that show clear signs of decline.
- Set a reasonable profit target, usually between 5% and 10%.
- Short-term coin swing trading. Especially within the same day, and focusing on a specific coin.
- Spread out multiple buy orders to increase your chances of success.
- Track and analyze Whale movements to avoid being affected by FOMO.
- Master knowledge of coin trading and master technical analysis techniques.
- Stay updated with information from reputable sources in the crypto market. Be wary of fake news that could affect the direction of the market.
Conclude
So crypto whale are large-scale cryptocurrency investors. They can create strong impacts on the market. Usually, they try to create big waves to dominate the market in their favor and make profits. Therefore, small investors need to know how to recognize them. Make a specific investment plan to be able to “swim” together and make profits. Don’t forget to continue following Crypto Trading to update more new knowledge!
FAQs
Who is the biggest Crypto Whale in the world today?
Determining who the biggest whale is isn’t always easy since not everyone knows exactly how much they’re worth. However, it’s safe to say that Changpeng Zhao could be one of the biggest whales around.
How Much Is a Crypto Whale Worth Today?
The most effective way to identify a crypto whale is to track the origin of significant transactions. You can do this through blockchain exploration tools.
How many Crypto Whales are there?
The number of whales in the crypto space is unknown. Some whales are so secretive that they are impossible to identify.
