Spotting a dump just before it happens

[SnowRoll]

Assuming someone decides to dump 18M ETH, or any other huge amount of coins, it's reasonable to assume that the coins should not be stored in the exchange for too long before the sell.
With transactions being transparent, could it not be possible to monitor ledgers for huge deposits and act accordingly, i.e. sell your coins quickly?
And if so, how difficult is it to automate that kind of monitoring?

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[eXpl0sive]

Even with public ledgers, you don't know if funds are moving to an exchange or between individual-owned addresses, especially when most exchanges allow you to generate new deposit addresses every time.

Also, exchanges like kraken allow "dark" trading, in which large sell walls by whales are invisible to other traders.

TL,DR: spotting a dump based on coin movements and sell walls is harder than we think.

[SnowRoll]

Even with public ledgers, you don't know if funds are moving to an exchange or between individual-owned addresses, especially when most exchanges allow you to generate new deposit addresses every time.

Also, exchanges like kraken allow "dark" trading, in which large sell walls by whales are invisible to other traders.

TL,DR: spotting a dump based on coin movements and sell walls is harder than we think.

Thanks for clearing it out.

[maku]

It is not possible to predict when exactly pump will happen. It is true that we can know exchange address, monitor it everyday.
But how we would know if the coins transferred belong to whale who is preparing for giant dump or it is internal exchange transfer?
We have no idea how much time someone decide to keep coins in exchange's wallet to dump it someday.

[John Wick]

there are some programs and the producer of them claim these bots are spotting dumps or pumps before they happen in the market. but i think this is not real and this bots or programs can't trace dumps.

[SnowRoll]

It is not possible to predict when exactly pump will happen. It is true that we can know exchange address, monitor it everyday.
But how we would know if the coins transferred belong to whale who is preparing for giant dump or it is internal exchange transfer?
We have no idea how much time someone decide to keep coins in exchange's wallet to dump it someday.

I can accept a case where monitoring is not possible, as explained above. But if a transaction IS visible, then it's a different story, regardless of its nature;
1. How many large size transactions are there? And by "large size" I mean the size that has a the potential of a significant market affect (and effect). >$5M ? or >$10M worth of coins?
2. Of those transactions, what percentage (an assumption based on historical data) were a dump and what were a legitimate transaction?
3. In both cases of a dump and a legitimate transaction - it's safe to assume that a cash-out will be involved, due to the amount at hand.

I think, even if just 20% of dumps (or huge transactions) can be spotted, it can be super-beneficial.
And even if it'll turn out to be a false-positive, you can buy your coins back at a similar price you sold them, a day or two later.

But, it's just a noob thought...  

[Pfizer]

If you're interested in economics, forex and tradig, you already know there are mathematical indicators and methods. Let's say you use RSI indicator to track your coin. If it goes beyond the value of 70, this basically indicates a dump or decrease.

[jlspartz]

Yes, watch patterns, momentums, waning support, volumes, and common indicators.  After a while you will just spot it within seconds.  Also, it's one thing to know the direction, its another to know the right timing, targets, risk and probabilities.

Unless you are talking about small alts where if one whale dumps, its over.  The only thing that will save you there is not being in it unless it shows enough volume and momentum, so when it happens it would at least allow for a double top rebound as an exit.

[pynetx]

There are patterns but one can not predict them like 1 day before. Everything happens in the short moments.

[dj_andreasgr]

If you're interested in economics, forex and tradig, you already know there are mathematical indicators and methods. Let's say you use RSI indicator to track your coin. If it goes beyond the value of 70, this basically indicates a dump or decrease.

these indicators hardly hold with alts. there is too much of manipulation even in the king itself (btc). how many days has rsi holded above 70 for example?

[Red-Apple]

it is impossible to know it before it happens, the only thing that you can do is to work on the chance of it happening. for example you can speculate that at a particular time the chance of a dump is getting higher, like when there is a bubble because of a fast big rise and the rise seems to be struggling at growing more.

that is usually when the whales realize that there isn't much profit left to be made and they decide they want to take their profit now. so they start dumping and surely enough the rest of the market follows them by some series of panic sells.

[jlspartz]

There are patterns but one can not predict them like 1 day before. Everything happens in the short moments.

It depends on the cap and distribution for stability.  Bitcoin is easy to predict 3 days prior barring huge news.  A few large alts, a day in advance, but it also has to align with BTC trend.  ETH is still sporadic due to its initial distribution.  Small alts, under the top 50, I wouldn't walk away from the screen.

[arbitrage]

I would say it is just like in Matrix you can sense coming changes but you will never know for sure what will happen, for this you must do lot of research on exact coin. Even then you cannot predict human errors or stupidity, just try not to be cough in one of those. Better to concentrate on finding floor!

[Smolko]

There are some hints you can spot, but the main issue still is that nearly every coin can be easily manipulated by a few guys with larger stocks. Coins with a smaller marketcap below 30 million USD can be already manipulated with probably 10 BTC? You can't spot this upfront.

[jacobthecoiner]

I think predicting huge dumps is as difficult as predicting earthquakes

[Heyo:P]

Sorry bud, it's next to impossible to spot a dump. If we could trading would be a heck of a lot less profitable.

[arbitrage]

Sorry bud, it's next to impossible to spot a dump. If we could trading would be a heck of a lot less profitable.

Sometime you can spot it when you have a lot of fud, you know what will happen next..Dump also occurs on news no matter if they are good or bad.
Pump starts with speculation about news. Then pictures of rockets and moon, even Venus start to appearing in main threads..All those are just a small indicators..

[n691309]

Even with public ledgers, you don't know if funds are moving to an exchange or between individual-owned addresses, especially when most exchanges allow you to generate new deposit addresses every time.

Also, exchanges like kraken allow "dark" trading, in which large sell walls by whales are invisible to other traders.

TL,DR: spotting a dump based on coin movements and sell walls is harder than we think.

The dark trading seems interesting to me, how do they allow this is this legal? Since these trades are not visible to the public then doesnt it mean that the fees there should be higher than normal or something like this? The kraken exchange is not user friendly as much as the poloniex or other similar exchanges but this dark trading seems a new thing to me which I would like to read more info about this.

[omonuyak]

With software I think it might be possible in future and by then many stringent rules may be set out and  volume of traders may not really affect the market that mush again. I think  the best thing to do is to follow trading strategy that has been used by experts. Buy low and sell high in combination with candlestick pattern.

[Febo]

Assuming someone decides to dump 18M ETH, or any other huge amount of coins, it's reasonable to assume that the coins should not be stored in the exchange for too long before the sell.
With transactions being transparent, could it not be possible to monitor ledgers for huge deposits and act accordingly, i.e. sell your coins quickly?
And if so, how difficult is it to automate that kind of monitoring?

Someone that wants to sell 20% of coin supply will not dump it but sell over longer period of time most likely will take months fro something like that. Altho high volume days are perfect for selling and such days were in last weeks. So perfect time to do it now since you would not need months for this but only weeks.