#Gate广场创作者新春激励

The most painful part of trading cryptocurrencies is: thinking it's a quick exit and selling in a panic, only to see it skyrocket; thinking it's a shakeout and bottom-fishing, only to get caught at the top and get blown away. How exactly can we distinguish between these two "dual faces" of the main players? Today, I’ve summarized the most core differences. I recommend liking and bookmarking this, so you can refer to it anytime during trading!

Identify the core purpose at a glance:
Shakeout = “Scare you”: The market maker aims to shake out retail investors with weak will, raising their average holding cost, making it easier to push the price higher later! Usually located around the mid-price level.
Distribution = “Tempt you”: The market maker creates a false impression of a big rally, attracting follow-up traders to buy in, so they can cash out easily! Usually at the high-price top. The most solid evidence: volume doesn’t lie! (Key point)

Shakeout characteristics: Sharp decline with decreasing volume (e.g., large bearish candle) but the trading volume is like a tightly closed faucet, significantly shrinking. This indicates the main players are not moving their positions, only retail investors are panicking and selling.
Distribution characteristics: Volume increases while the price stagnates or declines, with the stock oscillating at high levels or declining slightly, but the trading volume is huge, like a dam releasing floodwaters. This indicates the main players are frantically offloading their chips!
Finally, a tip to avoid pitfalls: Be cautious of volume spikes at high levels, don’t easily give up at low volume levels. When unclear, controlling your position size is the best defense!