What does the simple popular science currency circle mean by short-selling?

The "short luring" strategy in the currency circle uses market psychology to induce retail investors to buy under the illusion of a trend reversal, and then sell quickly, causing prices to plummet and retail investors to suffer losses. Specific manifestations include: large buying orders, good news, rapid price increases and sudden sell-offs. Ways to avoid short-baiting traps include: Be wary of large buy orders, verify sources, watch volume, and set stops.

Short-baiting: The trap in the currency circle

In the currency circle, "short-baiting" refers to a manipulation strategy that takes advantage of market psychology. Bankers deliberately create false impressions to make retail investors mistakenly believe that the market trend is reversing, thereby inducing them to buy, and then quickly sell after retail investors buy, causing prices to fall and retail investors to suffer losses.

The operating mechanism of short-selling

• Creating an illusion: The bookmaker creates the illusion of a market reversal by buying large amounts or releasing good news.
• Attract retail investors: False illusions attract retail investors into the market, thinking that the market is about to rise.
• Quick selling: When retail investors buy in large quantities, market makers quickly sell the tokens in their hands, causing the price to drop sharply.
• Loss of retail investors: Retail investors thought they were buying in reverse, but the price plummeted and they suffered losses.

Specific manifestations of short-selling

• Large-amount buying orders: Makers suddenly appear with large-amount buying orders at trend lows, attracting the attention of retail investors.
• Good news: The bookmaker spreads good news, such as an upcoming listing or cooperation with a large company.
• Rapid Price Rise: Due to the buying by market makers, the price rises rapidly, and retail investors mistakenly believe that the trend is reversing.
• Sudden selling: When retail investors buy a large amount, the dealer suddenly sells a large amount, causing the price to plummet.

How to avoid short-selling traps

• Beware of large-amount buying orders: Don’t be fooled by sudden large-amount buying orders, it may be an illusion created by the dealer.
• Verify sources: Verify the source of good news carefully and beware of false news.
• Observe the trading volume: Is the trading volume really rising or is it a man-made illusion?
• Set stop loss: Set stop loss point to prevent excessive losses due to short selling.

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