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Recently, many beginners have been discussing how to judge the true intentions of the main players.
Actually, this is a good question because many people can't tell whether the main force is shaking out the stock or distributing it, and as a result, they get trapped badly.
Today, I will share these four most practical indicators in hopes of helping you avoid being "shaken out."
First, let's talk about trading volume, which is the most intuitive signal.
During a shakeout, the main force will deliberately suppress the volume, using small fluctuations to scare retail investors into selling at a loss, making it look like a quiet oscillation.
But if the main force starts to distribute, the volume will significantly increase because they are continuously dumping chips into the market.
At this point, trading activity will rise sharply, and you can clearly see the difference just by eye.
Next, look at the stock price position and the percentage increase.
The main force usually begins shaking out around a 30% increase, which ensures there is still room for further rise and allows them to absorb chips.
But if the increase has already exceeded 60%, it’s basically certain that the main force is distributing, and you will often see a large volume at high levels, with obvious increased risk.
If you are still holding positions, my advice is to follow the main force’s rhythm and withdraw in time.
The trend of the intraday chart also explains the situation well.
During a shakeout, the main force will create sharp rises and falls to induce indecisive retail investors to sell, so the intraday chart will be very volatile.
But distributing is different; the main force will keep the stock price relatively stable, and the intraday chart will show a smooth trend.
This way, chips can be smoothly sold off without causing too much disturbance.
Observing the intraday chart can help you quickly determine whether it’s a consolidation shakeout or the main force quietly distributing.
Finally, look at the distribution of chips.
During a shakeout, chips will accumulate at the bottom, and the distribution will be relatively stable, like the main force is stockpiling "ammunition" for a future move.
But once distribution begins, chips will gradually loosen, and the distribution pattern will change accordingly—this is a very clear signal.
If you can understand the subtle changes in chip distribution, you can more accurately grasp the market rhythm.
Honestly, the difference between shakeouts and distributions lies in these details.
As long as you develop the habit of observing these four indicators, it will be less likely for you to be fooled by the main force’s tricks.
Recently, Bitcoin has also been quite volatile.
If you're interested, you can check real-time quotes on Gate and try using these methods to better understand the current market trends.