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Marketmakermethod

💰 Market Maker in Crypto Space. IntroductionGreetings, fellows! We are introducing a new article series about marketing making (MM) in cryptocurrency exchange. In these articles we will be focusing on the main MM strategies, current market trends and how to trade in this sphere. Firstly, it is very important not to get confused with the “market maker” meaning in the cryptocurrency sphere with the same term in classical markets. The only thing they have in common is that MM creates liquidity and it balances the market, and nothing else. In the classic MM, there is an agent who has to keep open the bid and ask orders with a particular (short) spread (between them), which is creating the exchange tool’s liquidity. • Who is usually a market maker in a cryptocurrency exchange market? Well, usually it's a small team, internal department, or maybe attracted specialists from the private companies. The team always includes a minimum one programmer and few traders (trading robot operators). • What is MM’s main goal? MM’s main goal is mercantile, all he wants is just to make money on an exchange tool manipulated by the agent himself. This goal is achieved by coin/token distribution into specific/perspective moments between the team members. For example, MM is forming an attractive graphic pattern while the market is growing to attract more potential customers. MM’s final goal is to choose the maximal amount of money or/and stronger cryptocurrency (BTC, USDT, ETH) they are planning to exchange into controllable “wrappers” Note: not every cryptocurrency project has trading and programmer teams that are ensuring the liquidity of their tokens or coins on the exchange market. Graphs below show the two typical examples, first one contains MM and the other doesn't. First graph clearly shows that trading bots have an impact on the tool’s price, spread and direction. We have a successful personal experience in this sphere. We were taking part in trading bots development and adjustment of trading bots on multiple exchange markets. Our plan is to have comments under each technical paragraph, where we explain and give real life examples. Next, we are going to analyze in detail the strategies and methods used to carry out this task, if we see that you are interested in such an article.
SEducation
by I.T.Analytics
2
Maket Makers Set A Bitcoin Trap? A sudden 2% pump in price for BTCUSD is exciting... it suggests we may finally see the market start to rise. However: On closer inspection we have cause to be cautious... Until we see a breakout or a swell of momentum and volume on higher time-frames, Team Sparkster is skeptical. The problem is that Market Makers (whales and institutions) can easily take advantage of the liquidity available above and below resistance levels. By pumping the price just a little bit during times of relatively low volume and thin order books, a whale can trigger stop losses causing a cascade of orders, even liquidations, allowing the whale to scoop up that liquidity and then sell it back to the market leading to a drop in price. Notice on the chart circled in green the long wick that extends beyond recent high. That move almost certainly triggered stop losses for short positions held above $9340. If the bulls do not quickly follow through with momentum up, then sure enough we could see another decline in price with many traders left in negative positions. And looking at the current candle we see resistance starting to set in. This is why lower time-frame trading can be so risky, cause money to be lost, and why Team Sparkster advocates a diligent approach to historical backtesting of particular trading strategies. Specifically, the 2-week chart for bitcoin shows a lot of pressure to the downside. Sudden 2-hour burst rallies may not be sustained market moves. Remember, most people eventually lose money attempting to trade on the financial markets. If you really want to play in the major leagues for sustainable profit, you need the tools and techniques to help you do so.
COINBASE:BTCUSD
by Sparkster