Cryptocurrencies have become a reality in the modern world and exchange trading. In this article, let's consider such an option, how to make crypto options, as an analysis of major market players. We will figure out who they are, how to track actions, and also try to benefit from this information.
Globally, there are no more than 20% of Forex companies trading in cryptocurrencies, but this year and next year there is a sharp increase:
- Crypto brokers supporting digital currencies;
- List of cryptocurrencies in the offered instruments;
- The emergence of new cryptocurrency derivatives and CFDs on crypto indices.
The world's largest investment banks and payment systems, such as JPMorgan and PayPal, have decided to publicly support the trading of digital assets that will appear at liquidity providers and automatically become available to clients of currency brokers and crypto options copy trading.
Many traders, for various reasons, have a negative attitude towards these instruments. They are technically difficult to understand, growth is similar to hype, and volatility significantly complicates the use of cryptocurrency options software for intraday trading. There is no need to talk about fundamental analysis at all - today there are no separate economic indicators for Bitcoin and AltCoins. The government's actions, such as the mining ban in China, are having a powerful effect on the market, but when they will happen, no one knows.
Despite the above disadvantages, there is one important feature that is present in almost every cryptocurrency. It greatly simplifies the analysis, forecasting of the movement of a digital asset and the quality of even crypto options free signals - the availability and transparency of all actions and transactions of large players and investors, which is considered an insider in traditional markets.
Market makers, stakers and holders - are the backbone of the cryptocurrency market ecosystem
Unlike real money or "fiat", the rate of which depends on the words and actions of representatives of the FED, ECB and other global financial regulators, inflation, the size of the issue and even the distribution of coins on hand is known in advance to every Internet user.
The code of any cryptocurrency is open, you can always find out the size of the final emission, the speed of issuing blocks with new coins and other data to search for reliable cryptocurrency trading signals. This information in a simple and accessible form, along with price statistics, can be found on CoinMarketCap website by selecting the desired digital currency or token from the list. For example, look at Bitcoin:
The latter tool helps to determine not only the speed of block assembly but also shows the transaction history of each coin, the size of the deposit of each wallet and the movement of the digital currency in general. This will be a good filter for false crypto trading signals. The main principle of the cryptocurrency blockchain is complete publicity and transparency, which opens up the opportunity for anyone to calculate the actions of crypto-whales and holders.
- Market makers or Crypto whale - holders of cryptocurrencies with large amounts of coins in wallets.
- Holder - is a more general term that applies to all traders who use a «buy and hold» binary options strategy.
Unlike Bitcoin, other cryptocurrencies can have "working holders". At the host, they “freeze” funds for a certain period as collateral (Stake). This guarantees «honesty" when confirming transactions without the risk of losing funds in the event of exchange speculations.
Thus, stackers are a certain type of miners who receive a reward for assembling blocks with cryptocurrency transfers in exchange for a share of the crypto placed as collateral.
If Forex market traders are forced to analyze the order book or wait for Friday's COT reports, then in most digital currencies it is not difficult to track the actions of large account holders and the movement of capital. Here, the blockchain serves as an open ledger of all transactions in a real-time source of information for auto crypto options signals.
How do market makers and steakers affect the cryptocurrency market?
The exchange rate of a single cryptocurrency, like a stock, depends on the number of free float assets in free circulation. Market makers, as a rule, collect coins in a wallet long-term storage, justified by the history of the growth of the exchange rate of digital currencies, which can be estimated by the dynamics of the total value.
According to the statistics available on the CoinMarketCap website, it can be seen that the market capitalization was $ 1.63 billion 8 years ago. Now the value of all assets is 1000 times more, it is accumulated by 45% in Bitcoin and by 25% in the first three large AltCoins. We always analyze cryptocurrency options trading signals for BTC first.
The rapid growth of cryptocurrencies made large players into convinced holders who, with cryptocurrency options strategy for buying assets and holding them, create a free-float deficit on the market, pushing the course to new heights. And for the same reason, digital blockchain is growing, where the "rate" is provided.
The desire to make money on the "freezing" of the cryptocurrency increases the rate due to active purchases of it on the market. Stacking often encourages the emergence of new market makers, because it is the size of the deposit share according to the blockchain algorithm that guarantees a higher frequency of receiving rewards.
How to analyze cryptocurrency blockchain wallets?
An increase in the balance of market makers' wallets serves as a signal confirming the current growth of the cryptocurrency market but does not give traders an advantage in the form of a leading indicator.
It is much more important, when using crypto options copy trading, to track the behavior of large holders at the time of a fall in the cryptocurrency market. If the decline in the exchange rate leads to a decrease in large deposits, try to sell out of the market or reduce the expiration – fast large sales can lead to a market collapse.
An active increase in deposits at the addresses of the "maker" of wallets at the time of the market decline indicates the proximity of the bottom. Of course, you should not count on an instant reversal when the described divergence appears. The trader must break his entry into parts and be ready to add or close options.
Large wallets can be found in the statistical compilations of cryptocurrency options software and blockchain explorers. These are special services that contain not only the history of all transactions but also an additional set of own research. For example, on the BitInfoCharts website, large addresses are in the "Explorer" section.
Let's choose the Bitcoin explorer for an example of analysis of options trading signals. As you can see from the picture below, the service has already broken down analytics into lists to track the actions of market makers. All major wallets are located in the Richest addresses (1). The observer gives out the top 15 addresses over the past day Top-100 rating can be seen by clicking on the name of the list.
Below is a selection of the top 100 addresses (2), selected by the amount of transfers in 24 hours. It is these statistics that are used to quickly track the actions of crypto-whales. The "Inputs" column shows how many transactions (in 24 hours) were received by the wallet. The “Outputs” column shows the number of transfers from the wallet. This information is important for deciding on crypto options free signals.
Accordingly, the input amounts are the totals of all deposits, and the output amounts are the deposit expenditures that we are interested in. Let's take a closer look at the current table.
Immediately remove the zero balances that are received and spent in one day. Cryptocurrency came and went right away, which does matter.
Do not pay attention to wallets with a high number of deposits and expenses per day, a trader should be interested in wallets with a large deposit that received a large transaction and did not spend it anywhere in a day, or vice versa - made a large withdrawal without receiving funds from the outside. Such accounts can be easily identified by the empty fields in the "Inputs" or "Outputs" column:
The image above shows that three addresses were found on such a system in 24 hours. Two addresses withdrew from the wallets a large sum of 900 BTC and 887.91 BTC, one address deduced 700 BTC. Obviously, on the day of analysis sales prevail over BTC purchases.
The blockchain allows you to find out the time of the transaction by clicking on the link to the crypto-kit wallet address. The deposit we watched was replenished on January 30, 2021. The owner decided to get rid of the entire amount on May 25 at 00 hours 41 minutes.
Let's compare this to the trend on the BTC chart. The sale coincided with Bitcoin's attempt to update yesterday's maximum. It is worth listening to the market maker, stopping crypto options copy trading and fixing some of the positions. The chart shows that he bought BTC at this year's low, held the position despite a 40% decline, and now closed it on a rollback. Profit on the deal $2,810,466.
As you can see from the analysis example, large transactions should be dealt with promptly; the Whale-alert service will help the trader in this, publishing transactions in dozens of types of cryptocurrencies in his Twitter account. The company provides streaming information about transfers from $ 20 thousand, providing them with a mark of importance and decryption if the recipient/sender of the wallet is known.
The filter of wallet owners is important to exclude from the analysis of cryptocurrency exchanges that keep all clients’ deposits at the same addresses. Previously, size correlated with the growth and fall of the cryptocurrency rate, but 2020 made unpredictable adjustments.
As the Bitcoin exchange rate and the market as a whole grew, the balance of wallets of all major exchanges fell sharply and PUT crypto trading signals turned out to be the most profitable. A similar case of divergence was recorded in 2016, which makes it possible for some analysts to claim the signal of a wave of mega-growth, but the fact remains that cryptocurrency exchange wallets are not suitable for the role of market makers.
Analyzing the total number of whale accounts is another way to predict the bottom and depth of a market decline. In addition to crypto options software statistics, we recommend the Glassnode website. Select the "Charts" option, the type of cryptocurrency and expand the "Addresses" menu:
The service offers 38 types of blockchain analysis for crypto trading, but the most informative is the number of addresses with a balance above 10,000 BTC. Notice how in history the big players quickly exited after long-term highs that the market spent years updating.
Striking on the chart is the panic sale of Bitcoin crypto kits at the time of the 2019 panic and the significant volume of purchases at the time of the March market crash during the 2020 coronavirus crisis.
The problem is that the service does not show free statistics for the last year, but it would surprise the analyst. For the first time in the history of the cryptocurrency market, the owners of huge BTC accounts used the unprecedented rise of the market for active sales of assets.
Summarize… Technical analysis continues to make a profit on any financial asset, even digital money and crypto options free signals. Looking at the indicators, the trader should always remember that the price is always the first to move the change in market volumes and the balance of buy/sell forces between market makers. Watching them, you can be the first to see changes: a new trend, reversal, pullback or correction. Be attentive and always be one step ahead of others.