Do we experience the start of a NEW BULL RUN right now? This piece will take examine the current situation and give you a best guess. Furthermore, it takes yourself out of the goldfish glass bowl mentality and shows you how Whales see the market.
My assumption: this article will be another epic piece and attract many readers. Too bad, I did not write it myself 😐 To be honest with you it is a real gem, just like the signals group, that contributed to our website: Alpha Trade Zone. These guys know A LOT of stuff and are working on really advanced solutions (like an auto trader which is connected to Binance & BitMEX and hedges positions automatically). They hired great traders and they success rate skyrocketed, while being way too cheap in my opinion.
No need to bore you further with my appraisal, though. From the Author of “The Ripple Mafia“, we proudly present: “Whale Secrets Revealed: Cryptocurrency Bull Market Cycles”. Enjoy!
If you are an avid cryptocurrency passionate and investor, you are probably aware of the immense cryptocurrency market volatility. Imposing high risk, but also extremely high reward opportunities this asset class has lured massive waves of participants in the past and will most likely keep doing so in the future, along with its advancing mass adoption by the society.
The cryptocurrency market, due to the low liquidity of most traded assets, is subject to extreme manipulation from the big players – called Whales. The whisper of manipulation often means that the first thing coming to mind is “conspiracy”. Not exactly. Manipulation is the outcome of a market that does not offer enough liquidity to the participants. Manipulation in the markets does not only relate to “inside information” trading but also to having the power to move the price of an asset in a desired direction. Now replace the word “power” with the word “money”. See where we are going?
Emotions in Trading
Keeping that in the back of our minds let’s look at the cryptocurrency market and the cycles it experiences. We witness two major stages in the market: a bull cycle accompanied with euphoria, greed and hope and a bear cycle accompanied with fear, desperation and loss of hope (and money). They are often associated with two main emotions from psychological perspective: Fear and Greed.
Identifying the two market cycles in crypto:
In order to create a new bull cycle there are two things that must be taken care of.
1. Let it calm down – The Accumulation Phase
In between the bear and the bull cycle price must remain in a mild state, going up and down into a tight range. This, known also as consolidation, is the phase of accumulation. This is the place where price finds a flat leveling stage, most of the smaller investors give up on their last positions because they are losing hope and trust that the market will ever go up and they leave the market in desperation and loss. This is exactly what the bigger whale players in the market are waiting for as they are aware of the market cycles and emotions psychology. They are incrementally increasing their positions, buying up the small player’s positions (buying into the fear) and stashing them for when the moods in the market change.
At the lower parts of the range big portions of the assets are getting bought that will get sold later at higher prices. This is a phase that takes space and time because of inadequate liquidity in the market. Traders known as whales are buying the asset from retail traders that are selling their positions due to fear since we are at the bottom of a bear cycle.
2. Creation of hype in the crypto space so that new money starts flowing in that help pushing the price to higher levels
When the accumulation phase is over there has to be a catalyst that will help those professional traders push price to higher levels. Most of the time this has to do with news. It’s either some fake news or some major fundamental event in which those traders have inside information about. The selection of the asset is not randomly done.
And it’s not always one asset…
It only takes one pair to create some interest in the space and motivate retail traders to FOMO in the game. Then the rest of the coins simply follow the path.
So it’s not the next bull run??
Now let’s get to the point! Every time a bull cycle happens people tend to believe we are heading into a new bull run and new all-time highs. Well, not exactly. Those cycles are artificial and not backed by real money flowing into the cryptocurrency market. Do not compare those cycles with the 2017 run, this was backed by huge hype, news and price was organically driven to higher prices. A legitimate bull run.
Back to out small artificial bull cycles in 2019. Focusing our attention only in BTC and the Major altcoins (ETH, XRP, TRX, ADA, LTC, EOS) since only these generate attention. So in every cycle we separate them in two categories.
The “First to pump” and the “Late to the party” coins. Their main difference is that the “Late to the party” coins are usually largest capitalization coins like BTC and ETH. The “First to pump” are mostly lower capitalization coins from the major altcoins. Those coins are easier to move due to less money needed to initiate some artificial pumps and create attention of retail traders. Money starts flowing from inside the market, while new money from big players are accumulating the hardest to move assets (BTC & ETH).
Now let’s get practical…
I want to shift attention on a specific date in the market. The 6th of February. This is exactly the time when TRX reached almost the top of its bull phase. This coin is a “First to pump”, it started pumping since December.
Let’s focus again on 6th of February.
Pay attention here..
This is how you define an artificial bull run from an organic one. TRX level on 6th. Same as it was when Bitcoin had the price of $7000! Total Market Capitalization at this price was over $240 Billion back then, now it was as low as $110 Billion. Our conclusion:
This coin was pumped artificially and there was not any strong evidence to support that it was an organic move. TRX topped out at 6th of February and money flew from TRX to the next asset.
In this case Litecoin…
Why the selection of LTC?
Simply, news about the halving plus it’s Market Cap was low at that moment. Litecoin, as a major asset in the cryptocurrency space, combined with the fundamental event is a coin that could generate a lot of FOMO in retail participants in the market.
After 6th of February price on TRX starts to stabilize and LTC starts pumping. Again, market cap is not growing, it’s obvious that money are flowing from TRX (since TRX is dropping) to Litecoin. Add one super bullish news like the halving event and the perfect opportunity is here. Spread it across digital crypto media outlets, make people fear that they will miss the next train that’s right in front of their eyes! Small retail investors are now willing to move from their Bitcoin holding to Litecoin because they hope on some quick, easy profits! Let’s explain it again. People are FOMO (fear of missing out) buying into TRX while it topped, so whales can unload their bags there and sell their holdings while moving on the next asset which is Litecoin. They have already accumulated Litecoin and after the 6th it’s time to pump. People seeing TRX then LTC growing in value are selling their Bitcoin for Litecoins. They essentially start moving Litecoin in value while selling Bitcoins.
Remember, for ever seller there has to be a buyer.
Who is buying those position that are being sold?
Whales. Accumulation is happening now in BTC. They made money both from TRX and continue banking on Litecoin but the safest and most important asset is still not moving. It’s the asset that will make them the most money since big percentage of their portfolio is allocated in BTC. Bitcoin also needs huge amounts of money to move eventually.
Next important date to shift our attention is 20 of March. This is when Litecoin reached a local top and ADA started moving. TRX is still dropping. No new money flowing into the market, money just flow from one asset to another. This run in both altcoins was a warning sign, next coin to pump in the market is a sign that some major move is going to happen.
Finally, when ADA starts losing momentum, Bitcoin makes its move up, and on 3rd of April 2019 most altcoins have topped out. Money is away from altcoins and into the strongest asset, Bitcoin. Dominance starts rising and those overvalued and overextended altcoins trap buyers while losing their value each day.
What we need you to keep in mind from this article…
Thank you for reading our work this far.
We are putting countless hours into analyzing every small detail in the complex market changes every day. Combined with our experience, we tried to explain in details the process that you have to follow in order to understand when the market is heading into a new bull cycle. It’s a different way to see the market, other than a plain chart. And it’s always handy when you have a different perspective. It’s how assets correlate to each other and how to they correlate to the price of Bitcoin. This is the real game, game that is being hidden behind closed doors that no one has ever revealed to the public. Now you are one of the selected few insiders to witness and likely confirm the legitimacy of our analysis. This is too far away from drawing some lines, rectangles and triangles like 90% of the paid channels will proclaim to teach you and make you money. This game is hard and requires deep understanding of the market behavior and knowledge of how money is flowing in and out.
It’s the only way to survive, there is no shortcut to success. We at AlphaTradeZone ® have fought our way to the top and have now shared a pinch of our trading secrets with you. Now that you have reached the end of our article, here is one small but handy gift for you!
Our 3 quick trading tips:Alpha Trade Zone
1- Never trade when you just wake up or before going to bed.
2- Never trade when you are tired.
3- When you make a decision, ask yourself, is it driven by FOMO/FUD or it is based on judgement.
Thank you for reading!
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