Buy Wall
In cryptocurrencyCryptocurrency is a digital or virtual currency that uses cryptography for security and operates independently of a central bank. Cryptocurrencies use decentralized technology called blockchain... More trading, a buy wallIn cryptocurrency trading, a buy wall refers to a large buy order or multiple orders at the same price level on an order book of... More refers to a large buy order or multiple orders at the same price level on an order bookAn order book on a cryptocurrency exchange is a list of buy and sell orders for a specific cryptocurrency, showing the quantity of the cryptocurrency... More of an exchangeA cryptocurrency exchange is an online platform that allows users to buy, sell, and trade cryptocurrencies. These exchanges serve as intermediaries between buyers and sellers,... More. The buy wall acts as a resistanceIn technical analysis, resistance refers to a level on a chart where there is significant selling pressure and the price of an asset struggles to... More level that prevents the price from falling below a certain price point.
A trader can use the presence of a buy wall to his/her advantage by placing a sell order at the same price point as the wall, taking advantage of the resistance level to sell at a higher price. On the other hand, if a trader believes that the buy wall is an indication of a pump and dumpA pump and dump strategy is a type of investment scam where a group of individuals artificially inflate the price of a particular asset, then... More scheme, he/she may choose to sell before the price drops below the buy wall level.
Buy walls are generally considered bad for the market as they can create artificial price floors, potentially leading to market manipulation. Furthermore, the removal of a buy wall can result in a rapid price drop, leaving traders who bought in at the higher price level with significant losses.