Smart Money Behavior refers to the investment actions of experienced and well-informed market participants, such as institutional investors, whales, or professional traders. These participants often possess superior information or analytical capabilities, and their movements can precede broader market trends. Observing their activities, particularly on-chain, can provide valuable signals for other investors. This behavior is often contrasted with that of retail investors.
Context
Tracking Smart Money Behavior is a key analytical approach in the digital asset market, as their actions are often seen as predictive indicators of future price movements. On-chain analysis frequently highlights significant accumulation or distribution patterns by large holders as evidence of this sophisticated activity. News reports often scrutinize these movements to infer market sentiment and anticipate potential shifts in asset valuations.
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