Banksters’ special ability: The Power to Squeeze the Market in One Click
The abilities of Banksters are not something vague and abstract. They are a replication of real-life circumstances that happen every day on the market. Today we are going to talk about the Market Squeeze. Unlike Pump&Dump, a trader can predict this situation on the market — so we will refer to its signals. By the way, a regular Bankster with this special ability can be the reason for a market squeeze, applying it with just one click.
A market squeeze is a situation in which many traders are forced to close their positions due to a sudden increase or a decrease in the price of an asset.
This can happen in several circumstances:
- When there is a sudden influx of buying/selling pressure,
- When shorters/longers are unable to borrow the assets, which they desperately need to cover their position’s liquidity.
Naturally, it looks like that — the whole price movement changes all of a sudden and goes in the opposite direction.
There are two types of market squeezes: short squeezes and long squeezes.
A short squeeze occurs when traders are forced to close their short positions due to a sudden increase in the price of an asset, which leads to an immediate Rally.
A long squeeze happens when a sudden drop in an asset’s price forces traders to close their long positions.
In crypto trading, market squeezes can be caused by a number of factors, including:
- News about the asset: a new partnership or vice versa a closed partnership, can lead to an increase/decrease in buying pressure and a potential market squeeze.
- Hype: Elon’s Tweet, Vitalik’s Buzz, or any other hype can do a trick.
- FOMO: Fear of missing out (FOMO) can also lead to market squeezes. When traders see that an asset is rising in price, they may be tempted to buy in, even if they don’t believe in the asset’s long-term prospects. This can lead to a self-fulfilling prophecy, as the buying pressure drives the price even higher.
- Coordinated pump&dump schemes: Market squeezes can also be caused by coordinated pump and dump schemes. In these schemes, a group of traders will artificially inflate the price of an asset by buying it up and then selling it off at a profit. This can lead to a sudden and dramatic increase in price, followed by a crash.
Some real-world examples of market squeeze in crypto include:
- The GameStop short squeeze in 2021: In January 2021, a group of “degen” retail investors on Reddit banded together to buy shares of GameStop, a struggling video game retailer. This buying pressure drove the price of GameStop shares up from around $20 to over $400 in a matter of days. The squeeze was caused by a number of factors, including negative news about GameStop, coordinated buying by retail investors, and the inability of short sellers to borrow enough shares to cover their positions.
- The Terra Luna crash in 2022: In May 2022, the price of Terra Luna, a stablecoin, collapsed from over $80 to less than $0.01 in days. The crash was caused by a number of factors, including the depeg of Terra’s UST from the US dollar, coordinated selling by whales, and the inability of investors to withdraw their funds from the Terra Luna ecosystem.
While predicting a market squeeze is not foolproof, there are indicators that traders can look for on a chart to potentially spot one.
Here are a few potential indicators to watch out for:
- High open interest: This occurs when a significant portion of a security’s outstanding shares have been borrowed and traded. A surging open interest ratio or percentage could indicate a potential for a squeeze.
- Price volatility: Before a squeeze, there may be increased price volatility as short sellers and long buyers battle it out. Wide price swings or sharp increases in both directions could signal uncertainty.
- Heavy trading volume: A surge in trading volume, especially when combined with rising or falling prices, could indicate a squeeze is underway.
- Breakout patterns: Traders may look for specific chart patterns that could indicate an imminent squeeze, such as a breakout from a resistance/support level or a consolidation pattern followed by a sharp move.
- Options activity: Monitoring options activity may also provide additional insights. A surge in call option buying/selling, especially at strike prices near or above/down the current market price, may signal a strong sentiment and potential for a squeeze.
It’s essential to note that market squeezes are difficult to predict with certainty, and these indicators should be part of a broader analysis. Unforeseen news or changes in market sentiment can influence market dynamics and trigger a squeeze.
For investors, market squeezes can lead to significant losses if they are caught on the wrong side of the trade. For traders, market squeezes can be an opportunity to make profits, but they can also be very volatile and unpredictable.
However, if you want to apply Market Squeeze without any risk or wait, there is a chance to bring it to your fingertips by playing Banksters.
Who are Banksters? What is Banksters?
Banksters is a Play&Earn, PvP, first-ever crypto trading, and investing game that allows you to squeeze the market in just one click.
How it works
Players must have already selected an Avatar with this Ability.
2. This ability works similarly to Pump&Dump, except that the points will be automatically applied to the worst-performing Coin after the round has ended.
3. It costs 2 Influence points and takes effect at the end of the current round only.
4. If your opponents have the same instrument, their coin will also be impacted, depending on their trade direction.
The number of points depends on the particular Bankster — its abilities and rarity.
The base is 62 points, where +4,+12,+16, or +24 points are added depending on the number of skills responsible for the ability. So it makes a minimum of +66 (62+4), a maximum of +118 (62+4+12+16+24), or any other options of these points’ combination.
If you want to become a professional Bankster, please watch our video with some key scenarios and examples of Market squeeze usage.
We have all seen moments when a helpless coin pumps in a market squeeze, giving unprecedented revenues to its traders. This is pretty rare! However, Banksters can apply this anytime.