What is a big cash flow?

The big money is the money that hedge funds and the big guys - the sharks, are dealing with.


Considered smart cash flow, these are trading performed by investors with more money, and "have more information" than other investors.

Every time the market makes big up and down waves, it is said to be moved by this large cash flow. It sounds a bit exaggerated, but actually, professional traders who manage huge amounts of money already have large trades in front of these waves. We don't have any solid evidence, but it's arguable that large cash flows are something to go for.
The trader can always go wrong - hence capital management is necessary.

Big money flow - Strategy 1: Support and resistance

Where do most of the big cash flows concentrate?


Support and resistance.

Resistance supports are zones of prices where, when the price hits, prices are likely to reverse. However, why did prices reverse there? Because that is where many large orders of Smart Cash flow are gathered. More importantly, it is a place where big hands are very fond of stop-loss hunting, above resistance and below support, as those are familiar stop loss positions of many retail traders.

Therefore a good strategy is to buy at support, sell at resistance. Or wait for the price breakout at resistance to selling; Now support to buy.

Big cash flow - Strategy 2: Round number area

An important factor for you to follow the Big Cashflow is in the round number areas.

When the price is around the 1000 round, the effect is greater than when it is at 970.

The circular number regions create a psychological effect on the human brain, and in trading, that effect has a huge effect.

Therefore, around the circular number areas, many large cash flows are often concentrated. There are also lots of stop-loss and limit orders.

A good strategy is AVOID STOP in circular numbers, as it is easy to prey on a stop loss shark. And DO ANY GROUND when the price hits the circles of numbers (for example, $ 1700 in gold).

Large Cash Flow - Strategy 3: Reversing bottom peaks

Large cash flows can also be found at top and bottom price reversal patterns.


When the price makes a higher low in a downtrend or a lower high in an uptrend, we know there is a transition in trend. And Big Money is working.

However, it will take a break to confirm that reversal.

(CONTINUE)

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