Tonight I came across a bunch of screenshots of "whale addresses entering the market," and everyone is shouting to buy in. To put it simply, before copying trades, you really need to distinguish whether they are building a position or hedging: the same address buying spot while opening a short, or transferring to derivatives to add margin, looks like increasing a position, but they might actually be suppressing volatility or locking in profits. On-chain, only seeing "buy/transfer in" makes it easy to be led by the rhythm.

I usually casually check whether they have opposite positions in the past few hours, whether stablecoins are flowing in and out in a matching pattern, and whether they are entering and exiting in batches (those that seem more like cost averaging are more like building a position). Recently, the rate cut expectations fluctuate between hot and cold, and discussions about the dollar index and risk assets moving together up and down are quite chaotic. The more this happens, the more it seems like someone is doing hedging, not necessarily bullish.

Anyway, when I see whale movements now, I silently say to myself: don’t take others’ risk control as your own signal… Never mind, I won’t talk about it anymore, just keep watching the market.