How To Spot Crypto Pump And Dump…
& double your investment in no time.
You’ve probably heard of pump-and-dump scams, in which investors profit from a sharp price increase (pump) accompanied by an even faster price drop (dump) (dump).
These types of schemes might involve a variety of assets, including cryptocurrencies.
Pump-and-dump scams occur when a group of investors buys an asset early and then convinces other investors to buy it, causing prices to rise even higher.
The initial investors then “dump” the majority or all of their shares into the market, causing a crash. Investors who were not among the first to enter the trade may suffer significant losses.
A crypto pump-and-dump strategy follows a similar pattern.
What is the difference between a pump and a dump?
Pump-and-dump schemes are a type of illicit market manipulation in which the price of an asset is artificially inflated by disseminating false information. When the price has climbed significantly, the manipulator sells their shares, creating a huge price drop and leaving other investors with assets worth much less.
Pump-and-dump strategies typically target tiny, unknown assets since their prices are more easily manipulated due to lesser trading volume.
Pump-and-dump schemes favour assets with fewer regulatory constraints, such as OTC stocks or cryptocurrency. Rarely heard of crypto coins or projects advocated by influencers are frequently extremely risky, resulting in massive price swings.
How Can You Tell Which Cryptocurrency Will Go Up In Value?
How can you know which cryptocurrency will skyrocket in value next? You’ll see a low market cap at the pinnacle of a pump, and low-volume cryptocurrencies are suddenly breaking out without warning.
You might even be persuaded to invest, but doing your homework before participating in any asset is vital.
However, a pump and dump crypto fraud can be detected before it occurs. Pumpers need a huge amount of tokens in the weeks and months preceding up to a push for their operation to succeed, and they must purchase up a large number of tokens without prematurely boosting value. Rapidly forming and receding buy/sell walls in these types of cryptos are a crucial red flag of pumping.
Another telltale symptom of a pump and dump scheme is fake news.
You can spot earlier which crypto coin will pump using a Pump bot. I’ve tried pump bot several times, and earned 200x profit from crypto pumps. Other methods are hectics, but if you want to try, I’ve listed them below.
What To Do If You Want To Spot A Pumping Coin?
~Keep an eye on the price changes.
Pumps and dumps are known for their rapid price fluctuations. Pump and dump is a concerted operation by a group of schemers; however, price swings can happen with any coin. The value of a coin begins to rise swiftly for no apparent reason and then decreases just as quickly for no apparent reason.
~Source of Promotion
Pump and dump scams are frequently orchestrated in internet chat rooms. It is possible to follow well-known pump and dump groups, albeit some may charge for real-time information.
~Keep an eye on the volume of trades.
Thin liquidity, also known as thin trading volumes, occurs when order books aren’t filled with enough buyers and sellers to keep pricing stable. It’s possible that market makers aren’t interested enough in a certain name to keep placing buy and sell orders.
~Capitalization of the market
Price multiplied by supply determines a coin’s market capitalization. Pump and dump groups are more likely to target low market cap coins because cryptocurrencies with lower supplies have less trading activity. Relatively small coins are vulnerable to price manipulation by criminal gangs.
Is it Possible to Make Money from Crypto Pump and Dump?
Pumps and dumps cause enormous price movements, resulting in large profits. If you’re on the correct side of the trade, you can profit from the pump and dumps even though you don’t know it.
Trying to benefit from pump and dumps might be difficult if you don’t get the timing right.
To spot a pump and dump scheme, you must have enough faith in the group you’re following to be first to market and artificially inflate prices. Additionally, you must be able to exit the trading promptly if you want to gain money from it.
To limit your losses, use a trailing stop loss, which allows you to quit a position if prices move abruptly downward. This entails placing a sell order at a certain price to limit your losses and remove your stake in the coin.
Otherwise, if you maintain a position for too long and leave slowly, you risk becoming a victim of the dump’s declining prices.