Many people think that when the coin price plummets, market makers are buying in at low prices, eager to follow and buy at the bottom. But the reality is that the core logic of washing is 'turnover'—transferring low-cost chips from retail investors to another batch of retail investors (or market makers themselves buy a little), while raising the holding cost, so that the selling pressure during the subsequent rise becomes smaller. In simple terms, washing is a 'preparatory action' for the market makers to control the market, not the goal.
Here I will break down the four major tactics of the market makers with real cases, and how to distinguish between washing and selling at a glance.
1. Why do market makers specifically target 'small market cap coins'?
Operators are not philanthropists; they have three criteria for selecting coins:
Small market capitalization: The circulating supply is between a few million and tens of millions of dollars, making it easy to control with a small amount of capital.
Low popularity: Not much institutional attention, and retail investors are like a scattered sand pile, making it easy to manipulate public opinion.
Chip dispersion: Without large holders in place, no one dares to catch the falling knife when the operators dump.
For example, for a small coin with a total supply of 10 million pieces and a single price of $1, the operator will first anonymously buy 5 million pieces (accounting for 50% of the circulating supply) to gain control. But if they directly push the price up at this time, retail investors who are floating at 100% profit will inevitably sell, making it impossible for the operator to exit. Therefore, washing is necessary—using panic to exchange for space.
II. Four major washout strategies: How do the operators 'scare' out your chips?
1. Downward washing: Dull knife cutting losses.
The operator first places a large number of fake chips on the sell orders, causing the coin price to decline from $1 to $0.9, then secretly buys back. After a few repetitions, retail investors see 'consecutive new lows', fear a complete loss, and can only cut their losses.
Feature: Every day falling 3%-5%, with trading volume gently increasing, like endless drizzling rain.
2. Oscillation washing: Grinding until you have no temper.
The coin price oscillates between $0.85 and $1, rising 10% today and falling 15% tomorrow. Retail investors get stuck as soon as they buy and fly as soon as they sell, ultimately exploding their mentality and leaving voluntarily.
Feature: The candlestick chart looks like an electrocardiogram, with moving averages sticking together and trading volume gradually shrinking.
3. Bad news washing: Coordinating with explosive news.
Operators collaborate with self-media to spread rumors (such as 'project party running away' or 'exchange delisting'), while simultaneously dumping heavily, causing the coin price to halve to $0.6. When panic selling occurs, operators secretly buy back.
Typical case: Certain coins suddenly drop by 50%, and the next day release good news to pull back; it is purely emotional manipulation.
4. Digging pit washing: Deep V temptation.
The coin price is first raised to $0.9 to create a 'rebound illusion', then instantly slammed down to $0.7, forming a deep V reversal. After retail investors cut losses at the V bottom, the operators quickly push the price up, making you regret it.
Feature: Long lower shadows are common, often seen in the rebound stage after a sharp decline.
III. The ultimate goal of washing: It's not to push up, but to exit!
The fundamental logic of operators washing is to solve three problems:
Reduce selling pressure: Wash away short-term profit takers, leaving the remaining investors with high costs who will not easily sell.
Creating liquidity: Only with sufficient turnover can there be buyers to take the operators' sales.
Control costs: Operators also buy high and sell low to lower their average holding price.
What if they push the price up directly without washing? Retail investors are all floating profits, and with no one willing to buy at high prices, the operators would be digging their own graves. This is why washing is a necessary step in the game.
IV. Two major signals to see through washing and exiting at a glance.
1. Look at trading volume: There is receiving during washing, and there is only selling pressure during exiting.
Washing: During a decline, trading volume does not shrink, and may even increase (operators are buying chips), for example, maintaining a turnover rate of over 15%.
Exiting: During a decline, there is no volume with a downward trend, and during a rebound, the volume shrinks (the operator no longer intervenes).
2. Look at the trend of moving averages: Washing does not break the cost line.
Washing: The coin price may break below the 20-day moving average, but it will definitely rebound within 3 days, and the moving average will always trend upwards.
Exiting: The coin price effectively breaks below the 20-day moving average and does not recover, with the moving average turning downward.
Mnemonic: Look for receiving during washing, and look for selling pressure during exiting. The moving average is the bottom line; if it breaks, run quickly without looking back.
V. Retail investor pitfall avoidance guide: Don't be a supporting character in the script.
Don't believe in sudden bad news: 90% of the bad news in the cryptocurrency circle is fabricated by operators; real risks come from the projects themselves.
Beware of shrinking volume rises: A rise without volume is often a bait to lure in more buyers, with operators deceiving you to follow the trend.
Avoid operator stocks: Small market cap coins are like casinos; operators can manipulate the candlestick chart while retail investors rely solely on guessing.
I have seen too many people obsessed with the 'follow the operator' tactic, only to be ultimately calculated by the operators. The essence of making money in the cryptocurrency circle is not a guessing game, but the realization of cognition. Instead of studying the operators, it's better to solidly watch the project fundamentals, community activity, and technological progress.
Remember: When you are no longer bound by emotions, there is one less supporting character in the operator's script. Follow Xiang Ge to learn more first-hand information and cryptocurrency knowledge at precise points, becoming your navigator in the crypto world; learning is your greatest wealth!#巨鲸动向 #加密市场观察 $ETH
