TravisStroud

Why fake-outs happen

COINBASE:BTCUSD   Bitcoin
This image shows why fake-outs occur. When a coming move is fairly obvious it causes a build up of short positions below the expected breakout. Trading platforms then profit from pumping the price to liquidate or activate stop losses of these shorts. The arrows show what may happen to the price over the next few days. It may even fake-out higher to trigger a bunch of long orders too.
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