Sell / buy walls. What are they?

Browsing reddit, see a lot of people asking what sell walls are, and an equal number of people giving a poor explanation of their actual purpose. So I've decided to copy and paste one of the top posts from 3 years ago. Hope OP doesn't mind.

What is a sell wall?

A sell wall is a tool used by a rich individual,or group of rich individuals, to manipulate the price of a stock downwards. A large sell order is set at a specific price by the whale(s) to prevent higher sell orders from executing. A sell wall looks like this on the depth chart: http://brettwestbrook.com/wp-content/uploads/2017/07/Screen-Shot-2017-07-12-at-12.58.10-PM.png

How does it work?

This is best explained as an example. A wealthy person, we will call him Richard, tells a group of his wealthy friends that he wants to make money on a particular stock. This could be for a number of reasons such as:

The stock has a lot of room to grow

The stock can be easily manipulated

The stock has a lot of potential to get big in the near future

Richard and his friends decide that it's a good idea. They all want 1 million of X cryptocurrency. Unfortunately, in the cryptocurrency market Richard and his friends can't execute all the buy orders at once or the prices will skyrocket! To achieve 1 million obtained goal, they decide to set up a sell wall, and manipulate the price downwards. They do this in steps:

They accumulate together. They will maybe get 250,000 of X crypto each. In their specific market, this didn't affect the price that much. Great!

They now set a specific price they feel is low enough for them to be able to reach their 1m X crypto goal. For this particular crypto they decide to all sell their obtained crypto at $2.40.

Now, between Richard and the group, there is >1 million dollars worth of X crypto selling for @2.40 on the market, a seemingly undervalued price.There is SO much volume being sold now, buying pressure cannot eat through that wall in a reasonable time frame - it would take a very high buying pressure to do so.

What also happens next is the key: nobody else can sell above that sell wall price until it's gone. The result? People need to sell lower than the sell wall in order to liquefy their stock. This drives the price downwards. Richard and his friends can now safey all get to their 1m X crypto mark without raising the price exponentially! When they decide to rid their sell walls the price moves up accordingly!

How can you use this to your advantage?

A common thought is that the main goal of a sell wall is to instill fear into the weaker hands so that they sell by the thought that "Oh no everyone is selling!!" While it's not the main purpose, it probably does happen a little bit. People get nervous when things a large volume of crypto is being sold. As Warren Buffet said: Be Fearful When Others Are Greedy and Greedy When Others Are Fearful. For a real life example: VECHAIN. For those that don't know, about a month ago vechain was sitting around 29 cents. They had a pretty large announcement that was, yes, front page of reddit. The price nearly doubled to 70 cents (it actually happened right before the announcement). What happened after? Some people bought the rumor and sold the news. But, this news was really big. Masternodes, rebranding, big partnerships. Ask any VEN holder why the price didn't continue to rise after that and they will probably know why - price manipulation with sell walls. Such as: https://i.redd.it/bjaubsgn04601.png VECHAIN has had a lot of new partnerships, announcements, and generally great news to propel the crypto further, but has been held back by these sells walls constantly. Just recently buying pressure has been very high and the whales have been having trouble controlling it they way they would like. That's a real example of what has been happening. Take a look at roadmaps and see where different projects are at in development. Are any projects getting seemingly great news without moving in price? What about REQ? We saw a couple of front page posts about REQ moving to main net, quality pictures from the UI, etc etc. REQ was fairly stagnant around 30 cents before slingshotting to 80 cents in nearly a day. Sell walls and price manipulation.This field is speculative so any news drives buying pressure. Unfortunately, the very wealthy have a say as well. Look for great projects and determine if they solve a need. Look to see what's hitting the media's spot light, such as the front page here. THEN take a look at the depth charts on the exchanges. In crypto anything goes, and you better believe the very wealthy have difficult to obtain knowledge. When you see these obvious sell walls, you want to investigate and try to identify any trends. Perhaps you can look at volume of a cryptocurrency. A stagnant crypto with LOTS of volume is a huge indicator, sideways consolidation. Ripple did this for a few weeks, even months at certain stages. Once you find one that looks good - you'll need to hold at the mercy of the whales. Trust me, they want profit more than you do. The wait is almost always worth it because price will rise very rapidly once selling pressure is completely abolished.

Hope this helps guys.

Edit: original post by u/tilted_till_tuesday