Steemit Crypto Academy – Season 3 - Week 1 - Post for @wahyunahrul

Based on the understanding that you've gained from this class, explain why whales are so feared by small investors?

In the cryptocurrency world, there are different levels of individuals also known as investors based on sizes of their cryptocurrency assets and the number of coins they hold. Mostly the large investors who are also known as the whales and the small investors. The whales are the large investors, they are at the top and hold the largest amount of coins. When it comes to trading and investing, the whales play a major role in the cryptocurrency market.

The whales represents the large investors in the cryptocurrency market. They are also referred to as market makers because of their influence in the market and their ability to move the market up or down. This is the main reason why small investors fear the whales. The main goal of the whales is to make maximum profit by buying low and selling high. In the cryptocurrency market, there are 4 phases; accumulation, uptrend, distribution and downtrend phase. The whales have a huge influence in each of the phases.

The small investors fear the whales because the whales can move the market in any direction, thereby causing smaller investors to lose money in the market. During the accumulation phase, the whales accumulate a lot of coins, driving the price up, this causes more and more small investors to jump in and fall into the trap because of FOMO and expectation of higher increase. This leads to uptrend movement. The whales begin to sell off their coins holdings and take profit in the distribution phase, the selling pressure begins to force the price to decrease, causing the small investors who bought at higher prices to lose money.

Example of cryptocurrency that was heavily influenced by the actions of whales is STORJ, dogecoin, bitcoin etc. Elon Musk, institutions and other large investors played a big role in the increase in the prices. The whales began to accumulate a large amount of STORJ tokens as soon as the news broke out that coinbase was about to list STORJ, this caused the price of STORJ to increase drastically.

Coinbase list STORJ - Whales begin to accumulate large amounts, causing the price to spike up and causing other smaller investors to FOMO in which led to the increase in the price of STORJ tokens.

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Will we be able to take advantages of the existence of the whale that is so feared?

Yes, it is very possible to take advantage of the existence of the whales in the market and make more profit. This is made possible by understanding how the cryptocurrency market works and the different market cycles and phases and also proper use of fundamental and technical analysis. With proper understanding on how the cryptocurrency market works and the different phases in the market, anyone can take advantage and make more profits. To take advantage of the existence of whales in the market, proper fundamental and technical analysis have to be done. With proper technical analysis, anyone can determine the best entry and exit points based on the actions of the whales in the market and the market trends. technical indicators like RSI, MACD, are great indicators that can help anyone determine the market trends.

Find an example of a whale's cycle on a cryptocurrency chart, and do a detailed analysis of the phases in the cryptocurrency chart

AAVE/USDT Pair
For this demonstration, I will be using the AAVE/USDT pair to show the different phases.

Looking at the chart, the accumulation phase of AAVE was around $420 - $475 range. During this phase, the volume also increased which showed the buying power of the whales. As the price began to increase, smaller investors began to enter into the market and buy. This increased the demand of AAVE and the price increased to about $650. There were multiple re-accumulations during the accumulation phase as price increased. This led to an uptrend, causing the price to increase to $650.

When the price of AAVE increased significantly, the whales made a lot of gains and they began to sell off their holdings to take profit and sell some of their positions, this led to the distribution phase. The volume began to decrease as whales continued to sell their positions. This caused the price to enter into a downtrend. There was multiple re-distributions as the moved into in a downtrend. The price of AAVE decreased down to $380.

AAVE/USDT pair

Accumulation

In the accumulation phase, we can see on the chart that the accumulation phase began when the price of AAVE was around the $480 region. The whales began to accumulate large amounts. During the accumulation phase, there were multiple re-accumulations due to fluctuation in the price. Horizontal movements is more visible in the accumulation phase.

Uptrend

The uptrend phase is as a result of the accumulation of the whales which drove the price of the asset up. As more and more investors enter the market, the market enters an uptrend. Looking at the AAVE chart, we can see the uptrend phase is visible. The price began to increase as more and more buyers enter the market. As the demand increased, the volume increased as well, forcing the price of AAVE to increase to about $650.

Distribution

After the whales have made a lot of increase in their holdings, the whales began to sell in order to take profit from their AAVE positions. This is the distribution phase. Looking at the chart, we can see the areas where the whales began to sell off their coins to make profit. The whales closely follow the rule of buy low and sell high, The whales have already accumulated at low prices, they begin to sell at high prices due to the buyers that FOMOed into the market. As the whales continue to take profit by selling and pushing the price down, the demand continue to decrease as well. Because of the selling pressure by the whales and FUD in the market, the price continue to decrease. There were re-distributions due to few buyers, but the selling pressure is greater and the price goes into a downtrend.

Downtrend

The downtrend phase is as a result of the selling pressure of the whales and the FUD in the market by other buyers who bought at higher prices and are afraid of losing all their investments. As more and more AAVE was sold, the price went into a downtrend, this resulted in a decrease in the price of AAVE as we can see on the chart. The price continued to move downwards and went all the way down to $380.

If you are a “Whale”, what cryptocurrency would you choose to invest or trade?

Dash (DASH) and Why I Choose Dash

For me, when it comes to cryptocurrency investments, I pay attention to fundamentals. I like to invest on cryptocurrencies with great fundamentals and have great potentials. I really like the idea behind the dash project. Dash is a payment cryptocurrency and functions like how fiat money works but on the blockchain. Dash is super-fast and the transactions speed on dash network are almost instant which is great for making sending and receiving payments and transactions in less time and at a low fees. As more and more people begin to use and adopt blockchain and cryptocurrency, fast transactions and low fees will be desired, this is why dash have a lot of growth potential. Because of its super-fast transaction, security, and low fees, businesses and institutions can accept payments using dash, and also, anyone can send payments to anywhere with fast transaction speed and low fees.

Dash (DASH) Uses

DASH has a lot of uses which is why I chose dash. Digital cash is one of the main use cases of DASH. This means that anyone can make use of dash to make secure payments, sending and receiving transactions. Since operates on the blockchain, it promotes decentralization and security of user funds, this gives users full control of their funds.

Benefits of the DASH

Dash offers a lot of benefits… some of the benefits of dash are

• Dash is one of the most popular cryptocurrencies, which means that it has a lot of exposure.
• Transactions on dash is secure
• It is a fork of bitcoin which means that it also inherits benefits of bitcoin and improves on it
• Fast transaction speed
• Self-governing and self-funding protocol
• Digital cash which means that it is great for payments
• High-end security

Dash - Social Reach

This is also a good reason why I would pick dash. Dash is one of the oldest cryptocurrencies and has a lot of exposure and potential on the upside. This exposure can be seen on the dash social reach. The dash social channels is pretty good and are active. Individuals, businesses, enterprises, institutions, are utilizing the power and benefits of dash for fast, secure and low fees transactions on the blockchain. Dash has a pretty large community most especially on twitter, reddit, bitcointalk. With 400k+ and counting followers on twitter. DASH is listed on most of the top exchanges.

Dash (DASH) Supply Statistics

Based on the current statistics on the coingecko website, DASH has a current price of $135.23, martketcap of $1,379,359,081, Fully diluted marketcap of $3,921,284,228, Circulating Supply of 10,212,771.48 DASH, Total Supply of 10,165,191 DASH and a Max supply of 18,920,000 DASH.

Screenshot of Coingecko

DASH Markets/Exchanges

DASH is listed on most of the top exchanges. This is a great fundamental because it means there is a lot of liquidity. This also increases the popularity and exposure of dash. Exchanges like

• Binance
• Huobi,
• Coinbase,
• Kucoin,
• FTX,
• Poloniex,
• Kraken,
• OKEX,
• Bitfinex,
• Gate.io and more.

Do a kind of analysis as a whale with the phases that I explained earlier on the chart of your chosen cryptocurrency, show where you will start buying the cryptocurrency, and explain how you will take profit

I will be using the same AAVE/USDT chart to demonstrate how I will buy and sell based on the market phases.

Accumulation

As a whale, I will begin to slowly accumulate the coins, this is the accumulation phase. Because it is difficult to identify because there is nothing concrete to show that the market would move upwards. Other investors usually stay away from horizontal movements in the market because the price can move in any direction at any time. This will allow me to continue to accumulate strategically to build my position and acquire a large amount at low prices. I will keep buying as prices fluctuate sideways.

Uptrend

As my buying power continue to increase, the price would slowly begin to increase, this will alert other investors and buyers on the potential uptrend. My buying power help push the price up, other new investors and buys enter the market due to FOMO and signals. The price will continue to increase due to the increased demand.

Distribution

Once the price have reached a certain price, I will begin to slowly sell my coins. I will take profit at the top and wait for the price to push up due to new investors entering the market and are not aware of the situation of the market. Once the price has increased again, I will sell off my coins to make the most profit.

Downtrend

This would cause the price to decrease. As the selling pressure increases, fear enters the market, FUD begins, small investors who are afraid to lose all their investments begin to sell out of fear. I have sold all my coins and have made enough profits prepare for the next cycle. I would wait for the downtrend to settle so as to begin the next cycle and accumulate again.

Conclusion

When it comes to cryptocurrency investments, the whales play a major role in the cryptocurrency market. The whales represents the large investors and are also referred to as market makers because of their influence in the market and their ability to move the market up or down. This is the main reason why small investors fear the whales. The main goal of the whales is to make maximum profit by buying low and selling high. In the cryptocurrency market, there are 4 phases; accumulation, uptrend, distribution and downtrend phase. The whales have a huge influence in each of the phases. Understanding these market cycles and phases is very important so as to make better investment decisions and make more profits.

@wahyunahrul