What are the differences between accumulation and distribution in the context of cryptocurrency?

1 answers

• Dec 25, 2021 · 3 years ago
  Accumulation and distribution are two fundamental concepts in the world of cryptocurrency. Accumulation refers to the phase in which smart money, such as institutional investors or experienced traders, starts buying a particular cryptocurrency in large quantities. This often happens when the price of the cryptocurrency is low or undervalued. On the other hand, distribution refers to the phase in which smart money starts selling off their holdings of a cryptocurrency, often when the price is high or overvalued. This is often done to take profits or to exit a position. These phases can be identified through technical analysis and can provide valuable insights for traders and investors. It's important to note that accumulation and distribution are not exclusive to any specific cryptocurrency or exchange, as they are market dynamics that can occur in any trading environment.
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