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Market makers' shakeouts have never been about your small gains. $BTC
Too many people curse market makers at the first drop, always thinking their holdings are being targeted. In reality—market makers simply don’t have time to care about your dozens or hundreds of coins. Their purpose is to shake out weak hands so they can fly higher and run more steadily in the future.
Let me share an example I witnessed firsthand. There was a small coin called METIS, starting at $1.20, with a relatively small market cap, circulating 10 million coins, with 60% held by retail investors.
A small team bought four million coins at the bottom, but they didn’t dare to push the price directly. Want to guess why? Because if they did, once the price hit $1.50, early retail investors would start panic selling en masse, and the team wouldn’t be able to absorb that selling pressure. In the end, they could only go along with the market, with no one to lift them.
So they had to shake out the weak hands, and they did it very rhythmically.
The first phase is called “Warm Water Boiling the Frog.”
The coin price slowly drifts down from $1.20 to $0.90 without volume or news. Retail investors start to get uneasy: “Is it over?” “Better sell now before it hits zero.” So they start cutting losses, while the market maker quietly accumulates at around $0.90. $PAXG
The second phase is “Sudden Drop to Cover the Bottom.”
The price suddenly plunges to $0.70, then quickly rebounds to $0.95. Many think it’s the bottom and rush in to buy. But the market maker dumps again, breaking the previous low and dropping to $0.65. All the bottom-fishers get trapped, their confidence shattered, and they have to sell at a loss.
The most ruthless phase is called “Panic Creation Period.”
With FUD news like “Project team withdrawing liquidity” or “Whales fleeing,” the price crashes to $0.50. The market is in chaos, retail investors are completely despairing, and they start to clear their positions and admit defeat. Meanwhile, the market maker is gobbling up large amounts in this zone.
The final step is called “V-Shaped Golden Pit.” The market maker quickly pushes the price back to $1 with a small amount of capital, creating a strong bullish candle. Those who sold at a loss are afraid to chase, while new investors’ average cost is around $1. $SOL
Through this operation, the market maker’s holdings increased from four million to six million coins, yet the average price actually dropped further. Most importantly, the weak floating supply was thoroughly cleared, and subsequent price increases faced almost no selling pressure.