The principle of currency market washing

The principle of the wash is to increase the concentration of currency price holdings by creating market panic, lowering currency prices, and eliminating weak retail investors. The characteristics of the wash include violent price fluctuations, increased trading volume, frequent bad news, low currency price consolidation, and panic selling by some retail investors. Strategies to deal with the wash include firming up confidence in holding currency, controlling positions, looking for bottom support, paying attention to market news and waiting patiently.

Principle of Coin Washing

Washing is a common phenomenon in the currency circle. It means that the banker or the main market force uses a series of operations to eliminate retail investors who are not confident in holding the currency, thereby increasing the currency price. The holding concentration of the price paves the way for the rise in the market outlook.

Principle of washing:

• Creating market panic: Marketers create market panic by selling chips and spreading bad news, causing retail investors to sell their currencies.
• Reduce currency prices: Retail investors’ selling causes currency prices to fall, further exacerbating market panic and forming a vicious cycle, causing more retail investors to sell.
• Profit-taking is eliminated: A drop in currency prices will lead to profit-taking being eliminated, releasing selling pressure and further pushing the currency price down.
• Weak retail investors are eliminated: Panic and falling currency prices make weak retail investors unbearable. They will sell the currencies in their hands and be eliminated from the market.
• Market stabilization: Selling pressure has gradually been released, market panic has weakened, and currency prices have stabilized.
• Raise the currency price: The banker or the main market force re-enters the market, absorbs the chips sold by retail investors, raises the currency price, and completes the washout process.

Characteristics of dishwashing:

• Short-term price fluctuations are violent.
• Trading volume is amplified.
• Bad news comes out frequently.
• The currency price is consolidating at a low level.
• Some retail investors panic selling.

Strategy for dealing with the washout:

• Firm confidence in holding currency: Don’t be affected by market panic, trust your own judgment on the project.
• Control positions: Don’t take heavy positions, build positions in batches, and reserve a certain amount of funds to cope with market fluctuations.
• Find the bottom support level: Pay attention to the currency price trend. When the currency price is close to the bottom support level, you can consider adding or covering your position.
• Pay attention to market news: Understand market dynamics, grasp the good and bad news in a timely manner, and avoid blindly following the trend.
• Wait patiently: Washing is a process that takes time, stay patient and wait for the market to stabilize and rebound.

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