The level of manipulation in the crypto market continues to surprise traders. Manipulation in the market comes into play due to the rich traders. Wealthy traders use ninja techniques to turn the market in their favor.
Manipulation through Buying & Selling
This is a common practice which wealthy traders adapt to earn a good profit. They buy the coin at a lower price and keep it for several days. It results in a price increase and forms an attractive trading chart. Inexperienced traders start pumping in money by buying certain coins. They have a fear of missing out on the chance to earn profits.
When traders start pumping in new money the price of the coin is pushed upwards. Once the wealthy trader is satisfied with the value of the coin he dumps, he claims all his profit. Rich traders don’t dump the whole amount at once as they sell it off in different transactions known as “waves.”
The step by step dumping process is quite profitable for rich traders. In the end, they make good profits with nothing left for inexperienced traders.
Insider news from the market
Rich traders like to act fast on the insider information that they receive much in advance. Once they are informed that there is some good news coming in for the cryptocurrency market, they will acquire the coins at a cheaper rate. To get the coins at a cheap rate wealthy traders place their orders at such a value that it starts creating panic situation in the market. Investors start selling their coins in such a situation and the price drops.
This technique works well in favor of the rich traders, and it results in a loss for new comers. There are private exchanges that allow rich traders to trade anonymously. It creates “sell walls.” Rich traders easily buy in a huge quantity of coins, and this is not made public.