Post
--Bullish
N4G
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Bullish"Bluff zones" What are they? - A lesson by me-
During an up trend, the market makers 'mm' will usually drop the market hard and fast but not too hard or too fast, just with the right amount of dumping to make it seem like a reversal is going to happen.
Now there are 2 types of a drop, a retracement and a reversal, the 2nd one is the one we all hate, but the 1st one is the one i call here "Bluff zone".
Bluff zones or retracements are usually a sign of a healthy trend, markets can't withstand going upward all the time, there must be a period of cooling down, these areas where the Market makers make money, because some retailers and even hedge funds bet on short future trades, others start dumping their assets thinking the market is going to crash, which gives the market makers the opportunity to buy the assets at a discount price and also open new short positions so they could liquidate them, they also get to sell some of their bags for a margin of the profit so they don't end up buying the total supply of a coin.
So in general, Retracements or bluff zone as i call them are very beneficial and urgent for a strong uptrend, after all, the money the market makers make from these retracements are used to buy the asset and raise it even higher.
It's crucial that you train your eye to identify a retracement and a reversal and know the difference between them.
A key point to do so is by learning about price action and ditch using your indicators, i feel pity for traders who talk about indicators as if they are a magic ball.
follow me if you want to learn more about trading.
#N4G
#LearnFromMistakes
#LessonsFromTheMarket
$NEAR
During an up trend, the market makers 'mm' will usually drop the market hard and fast but not too hard or too fast, just with the right amount of dumping to make it seem like a reversal is going to happen.
Now there are 2 types of a drop, a retracement and a reversal, the 2nd one is the one we all hate, but the 1st one is the one i call here "Bluff zone".
Bluff zones or retracements are usually a sign of a healthy trend, markets can't withstand going upward all the time, there must be a period of cooling down, these areas where the Market makers make money, because some retailers and even hedge funds bet on short future trades, others start dumping their assets thinking the market is going to crash, which gives the market makers the opportunity to buy the assets at a discount price and also open new short positions so they could liquidate them, they also get to sell some of their bags for a margin of the profit so they don't end up buying the total supply of a coin.
So in general, Retracements or bluff zone as i call them are very beneficial and urgent for a strong uptrend, after all, the money the market makers make from these retracements are used to buy the asset and raise it even higher.
It's crucial that you train your eye to identify a retracement and a reversal and know the difference between them.
A key point to do so is by learning about price action and ditch using your indicators, i feel pity for traders who talk about indicators as if they are a magic ball.
follow me if you want to learn more about trading.
#N4G
#LearnFromMistakes
#LessonsFromTheMarket
$NEAR
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