How trading works and how we should read the market | Introduction Part 1



Cover created in Canva

Trading is a profession that requires a lot of study and perseverance in order to be successful. In publications that I have made on this subject, I have pointed out the most important aspects that we must take into account to operate the financial markets, among these things we have of course the technical analysis, the fundamental analysis and the correct handling of the platforms or brokers that connect us to these markets to be able to invest in these assets.

However, one aspect that I have not mentioned and that we should all take into account, is how "Trading" really works, how we should read the market, as well as knowing who really moves the market and how they orchestrate the big movements that usually leave millions of investors out of the game making them lose money.

Important: What I will comment is my personal experience, capturing all the knowledge I have acquired over time in this great profession, likewise I will be publishing several parts of this topic.

Who moves the markets?


You may think that markets are moved by all your investors and that they drive assets both up and down depending on their feelings or what they think is convenient for that specific moment, in part this is so, however, those who truly move the price are the "Strong Hands (Whales)". All these markets are manipulable without exception and these big money holders always apply the same strategy to obtain profitability in them, basically orchestrating what is called a "Professional Manipulation Pool".

How do they work and what is the essence of these manipulation pools?


I have already mentioned that basically these "Pools" are a group of professionals that orchestrate investments in an almost coordinated way to invest in assets that they consider to be too cheap, likewise other whales are aware of these big movements and also intensify this manipulation by joining in the purchase of these assets.

Fases de mercado.png

Market phases

Accumulation phase


So in a way the novice investors, who are trying to take profits out of the markets but who are victims of the panic over bear markets and bad news from the media, unwittingly sell in despair and become the counterpart these professionals need to buy and accumulate these assets. This period when the whales are gradually buying up is called the "Accumulation" period".

Upward Trend Phase


Once the selling interest is over, and the selling pressure is over, the price can only do one other thing, which is to go up, it is in this phase where the professionals start to have their first benefits, besides that those who catch the movement can enter the market and still have some profits, something like a period of euphoria, where everyone can buy so as not to miss the big movement and make money. According to the phases of the market determined by Wyckoff, this is specifically called the "Market Up Phase".

Distribution Phase


Once the buying interest is decreasing and strong hands detect this feeling, many investors believing that the rise will have no end, will enter the game too late, so the whales will start selling their assets, which they had already bought at very cheap prices because of the bearish sentiment at that time. This action will sooner or later end the demand and cause a collapse in prices. This whole process is called the "Distribution" phase".

Downward Trend Phase


Already in this phase when the strong hands (Whales) have distributed all their assets selling them little by little and the demand has already disappeared completely, prices begin to collapse and the so-called "Market Down Phase" begins, giving way to supply in this sense dominates the game and opening new opportunities for profit, but this time investing downwards in certain assets where we have detected this market phase.


I'm done for now. This is a series of posts, where I will address how to truly understand the market and how it works, so I will divide it into several parts to not make each publication so extensive and thus not make a tedious reading, but if it is full of much information and knowledge, I hope you like it.


Link to the Erarium community in STEEM

Other posts of educational interest for the community:

The importance of Technical Analysis in Trading | Horizontal Supports and Resistances
The importance of Technical Analysis in Trading #2 | Mathematical Support and Resistance
Binance Trading Methods : Trading Spot/Margin/Futures
Binance Trading Methods #2 | Trading SPOT


I am Co-founder of the @erarium project, in this community we offer training processes in trading, finance and economic management. Consider joining our official Discord by clicking HERE.

If you are new you can join the game under this LINK

Live the BraveBrowser Experience. Browse fast, safe while earning BAT tokens.
Please download the browser using my
Referral Link.


Communities I support and promote



Join the discord of @project.hope

Join the official Discord community

Go to the Discord server community officer in Spanish

Join @gems-community's Discord


Authors get paid when people like you upvote their post.
If you enjoyed what you read here, create your account today and start earning FREE STEEM!
Sort Order:  trending

As a follower of @followforupvotes this post has been randomly selected and upvoted! Enjoy your upvote and have a great day!

Trading surely requires technicality and properly understanding the operation of the market, good analysis buddy.

You couldn't have described the entire market process any more better, well done and thank you for this. Trading profitably is simply a matter of knowing when to buy and when to sell, knowing how to deduce the direction the market is going through patient studying and perseverance.

I enjoyed reading this....

To trade require a lot of effort and knowledge. I once was only depending on the Bollinger band and the resistance line indicator but 30% profit and 70%loss and at the end of the day I find myself losing than even profiting

The world of traders is still a little far away for me, but little by little I try to understand a little more each day.

however, those who truly move the price are the "Strong Hands (Whales)".

The whales seems to have great influence and power over most crypto related platforms due to the amount of their investment. This also what seems to be happening on Steemit too.

Thanks for sharing this great post with love from @hardaeborla and I hope you have a great day ahead