When you trade, don't think that you are trading with another human. In 90% of cases, your counterparty is an algorithm (Bot) from large financial institutions known as Market Makers (MM).
🔸 White MM are the silent heroes. They place thousands of Limit orders to ensure instant liquidity. Their profit comes from the Spread and high volume.
🔸 Dark market makers are the dark side of the unregulated world of cryptocurrencies.
Projects hire market makers to fix prices by paying them the rights to buy tokens at a low price.
Manipulation cycle:
Bots trade with themselves to fake volumes and get into the top trends.
They push the price to create FOMO for retail investors.
The market maker exercises its right to buy at a low price and immediately offloads tokens to investors at a high price. The profit is huge, while the token price then plummets.
🔸 Signs that indicate market manipulation:
The price rises vertically, stays in place, then falls back down vertically to the beginning.
Abnormal long spikes that take out stop losses from both sides – both long and short.
High trading volume, but the price remains unchanged.
🔹 Never think this is a fair game. You are fighting against supercomputers that know exactly where your stop loss is. Before buying low caps, research who the market maker is.
Before investing in a low-cap coin, do you research who the market maker behind it is?
News is for informational purposes only and not for investment advice. Please read carefully before making decisions.
