The cryptocurrency market is highly volatile, and this is factual. The whales control a huge chest of wallets, and this places their actions under the radar of market watchers.
Within the last three days, whale action has reported on social media with some dormant accounts witnessing significant movements . This is not without substance as it can be a pointer to a possible massive dump or some form of wallet reactivation. Should you not pay attention as a crypto trader?
Scenario 1: A Massive Dump
When there is a massive dump of cryptocurrencies, the market is affected, and a sell-off is triggered. This scenario dampens the market and a price crash will be seen across the board. While institutional hodlers do not announce their investment decisions, their wallets speak volumes when any activity is recorded.
The interpretation of the actions of the whales cannot be lost on the small-time investor or any other hodler. In most cases, whales act on insider information and this is one of the reasons why you can only ignore them at your own peril.
Scenario 2: The Trap
Whales are aware that their actions cannot be hidden, and this opens the room for them to play on investors’ fears. Knowing fully well that many people will do a sell-off at their prompting, they also manipulate investor psychology.
In a bid to acquire a greater percentage of a token or coin’s market share, a rumored dump can be instigated. Sometimes, what might have happened cannot be more than a transfer from an unknown account to another unknown account.
