Is It Important For Retail Cryptocurrency Investors To Think and Act Like Bitcoin Whales?
- It is important to think and act as a Bitcoin whale, according to crypto analysts.
- It is worth using Bollinger Bands and buying Bitcoin when the price falls.
Thinking As A Whale
The cryptocurrency market is full of participants from different countries and with a diverse amount of money available to invest. However, one of the most important, but reduced, groups of crypto users are whales. These investors have large amounts of money, they can manipulate the market, and every decision they take will have a profound impact on the price of Bitcoin or other assets. This is why it is important for retail investors to understand how they behave.
In a recent article released by CCN, they explained which are the secrets that retail investors need to know to trade Bitcoin like a whale. The first thing they mention is to have a look at Bollinger Bands, which are single data points that are placed one standard deviation above and below each day’s closing price.
These Bollinger Bands work as short-term buy and sell signals. Once Bitcoin touches one of them, it is expected for the price to switch direction. Although there is no 100% security that Bitcoin hit a bottom or a top, it could mean that this could happen in the near future.
Buying Bitcoin When There's “Blood in the Streets”
When Bitcoin dropped from $6,000 in November 2018, the price of the digital asset left the bands. This was a signal for buyers to enter the market. Whales paid close attention to them. Bitcoin then started to grow and in the end, it surged above $9,000 just a few days ago.
The second recommendation that Lawrence Meyers, the author of the article made, is related to purchasing Bitcoin when there’s “blood in the streets.” He said that an 85 percent decline in Bitcoin prices was definitely a case of blood in the streets. Thus, this was also an indicator that Bitcoin was going to be surging in the near future.