Whale traps in the cryptocurrency market are a manipulation tactic in which large investors, known as “whales,” create fake price movements to fool smaller investors. Here’s how they typically work:

1. **Pump**: Whales buy a large amount of cryptocurrency, causing its price to rise rapidly. This increase attracts smaller traders (retail investors) who think the market is rising, prompting them to buy at higher prices, hoping for continued gains.

2. **Dump**: When enough retail traders buy as the price rises, whales start dumping their holdings, causing the price to plummet. Smaller investors who bought at higher prices suffer losses when the market reverses.

3. **Profit for whales**: Whales profit by buying low and selling high, while smaller traders get caught in sudden price reversals, often referred to as “getting trapped”. This tactic is common in highly speculative or illiquid markets where a small number of large players can significantly impact prices. This is risky for those who react to short-term price movements without fully understanding the underlying dynamics of the market.#IntroToCopytrading #BinanceTurns7 #MarketDownturn #Write2Win $BTC