I've been recently been reading some books and articles by Richard Wyckoff, who traded manipulation patterns in the stock market around the year 1900-1910. I believe looking for these patterns could be useful in crypto-currencies, as they share the low liquidity and high ease of manipulation of the stock market at the time Wyckoff was trading.
This pattern could indicate that institutions and manipulators are distributing their bitcoin into the market. According to Wyckoff (and common sense), a manipulator can not dump all their bitcoin in one go without them selling for less than they would like, because of the lack of liquidity. They instead look for liquidity pools where retail traders will look to buy, or be forced to buy (short sellers stop losses). Once the manipulator has increased the supply of bitcoin in circulation, the price should eventually drop.
This is a possible trade, after visiting one more liquidity pool. I'm still only testing these ideas so i'm putting in a very small short trade.
This pattern could indicate that institutions and manipulators are distributing their bitcoin into the market. According to Wyckoff (and common sense), a manipulator can not dump all their bitcoin in one go without them selling for less than they would like, because of the lack of liquidity. They instead look for liquidity pools where retail traders will look to buy, or be forced to buy (short sellers stop losses). Once the manipulator has increased the supply of bitcoin in circulation, the price should eventually drop.
This is a possible trade, after visiting one more liquidity pool. I'm still only testing these ideas so i'm putting in a very small short trade.
Comment:
Looks like it could have broken down already
