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Trapped-traders

Stop and Run, 0xREV, TrapTheoryLet us deep dive into all the reasons why these levels mentioned above needs to be considered in taking the next trade. Used OI, CVD, BidAsk candle using ATAS. 1&2:Explains why should we wait for trades to come to us As you can see 1 did not work as expected, but 2 gave us a good rejection. Lets look deep into the Bid ask candle and OI at these levels gyazo.com the 618 did not give us a good confirmation, that was evident on the bid ask OI and cvd. gyazo.com 786 on the other hand look how the OI crashed with 0 ask and cvd spiking out. 3: Did not work as expected but.. gyazo.com Now for BId ask candle see there are 0 ask on the level, we had good divs at the level maybe thats the reason for a small move down. 4 & 5: see the levels and how price reacted, lets look into 886 first, gyazo.com we had everything lined out for us trapped longs, OI cash and CVD spike. Unfortunatly this would have been a small scalp and nothing more as price came out to take the SFP level. gyazo.com this is how perfectly the levels payed an important role in trapping the breakout traders, never should you be on the side of breakout trades as this is how they get annihilated, 0 ask and all buyers at that peak, market reversed by taking all the liquidity, see the POC of that candle there is no way this was flawed everything was brilliant. RIP breakout bois.
BYBIT:BTCUSD.P
by phenodev
4
Why BEAR-TRAP occurs? How to Avoid and Trade a BEAR-TRAP?What is a BEAR-TRAP? --> BEAR-TRAP is a condition in the market where the Price gives a Breakdown below a Potential Support zone but quickly Reverses back above the Support without giving a follow up bearish candle. Why a BEAR-TRAP occurs? --> Big Players who are bullish on a specific stock would be wanting to buy a big quantity of shares at the best price , but there will be no enough sellers . Hence All Buy Orders of Big Players would not get filled. so what's the solution? --> Big Players know that the Retailers have maximum of their StopLoss order's just below the Support. --> Big Players will place Contra-Short Trades and will trigger the Stop-Loss Orders of the Retailers turning them into a Seller .Hence All Buy Orders of Big Players will get filled. . --> New Breakdown Traders place Fresh Short-Sell Orders looking at the Breakdown and if its a F&O stock , Call-Sellers open new positions at ATM (At the money) Strikes. . --> Now as All Buy Orders of Big Players got filled. . BIg players aggressively start moving the price up and trigger the Stop-Loss Orders of the New Breakdown Traders and Call-Sellers who entered looking at the Breakdown which ,again shoots up the price. -->Hence All Bears are been Trapped. How to avoid a BEAR-TRAP ? --> Look at the Volumes on the Breakdown ! If the Volumes are Low , It is probably a Fake Breakdown! . --> Wait for a follow up Bearish- Candle after the Breakdown Candle! i.e Take a entry only when the Low of the Breakdown-Candle breaks. --> Check out if there is a significant Long-Unwinding if its a F&O stock. How to trade a BEAR-TRAP ? -->Check out for a Reversal Pattern soon after the Breakdown. Eg: Bullish Engulfing, Bullish Harami, Bullish Piercing .etc --> This Reversal Candle Stick must close above the support. -->Enter a Long Position above the high of this reversal candle . Real Example! --> NSE:POWERGRID was trading within a Rising Channel . --> POWERGRID gave a Rising Channel Breakdown below 196 and gave a daily closing at 191. Perfect breakdown right? -->Breakdown Traders entered here keeping their Stoploss above the POC or just above Psycological level 200. and Call Sellers would have Shorted the POWERGRID 200 CE STRIKE . --> Check out the volumes on breakdown! Its very very low signifying its a Fake Breakdown. --> POWERGRID on the following day made a Bullish Above Stomach Candlestick pattern and gave a closing above the support level 196. -->Perfect Buy would be on 1HR Closing above the support level 196 on the next day. -->Boom! Price made an Impulsive Movement after it triggered all the StopLoss Orders placed at Psycological level 200 by the Breakdown Traders and also due to the Short Covering at 200 CE STRIKE . --> Wasn't it a perfect BEAR-TRAP Trade? If you liked this Educational Idea, Kindly LIKE,COMMENT, SHARE, & FOLLLOW me on Trading-View for more educational posts like this.
NSE:POWERGRIDEducation
by Roswin-Fernandes
2
A SYMMETRICAL TRIANGLE TRAP VARIATIONTriangles are one of the best continuation patterns. They are normally seen in the middle of a trend as the price halts and rebuild energy to resume in the direction of prevailing trend. In this particular variation shown on the chart, the price breaks against the trend. It would look like as if the pattern is about to fail but the breakdown ends up in a trap. It traps most short sellers on the wrong side of the market at 6. The price then shoots up with strong momentum leaving no choice for the short sellers than to cover their positions. So instead of only breakout buyers at 7, the variation will also trigger buy orders of trapped short traders. Due to large number of buy orders at 7 the price shoots up pretty fast without any major pullbacks. Its always good to keep such a strong weapons in your quiver and strike whenever the opportunity knocks. It needs to be pointed here that the pattern will lose its worth as the price drifts closer to the Apex. As a rule of thumb, If the price is beyond 3/4th the length of the triangle, as shown on the chart, the pattern should be traded with caution. If the price has drifted up to the Apex, then ignore the pattern and move on to a next one. The target for the triangle should be the height of the triangle from 1 to 2. This length measured above 7 will give us the target. Ex. If the distance between 1 to 2 is 50 points and the breakout 7 happens at say 550, then target will be 550+50 = 600 (just an example). This is a conservative approach. Some trades would like to hold it and trail their stop loss until they get stopped out. It all depends upon one's trading style. I hope the post would catch your interest. Do like and comment for more educational ideas in future. Regards JJSingh
NSE:NIFTYEducation
by Bravetotrade
2