As the name suggests, Fakeouts are breakouts that failed to continue beyond a level, resulting in a ‘false’ breakout. Traders who take long trades on breakout of the anticipate price to keep going up. A fake breakout (also known as 'Bull Trap') happens when price reverses and starts falling instead of continuing to go up. Similarly, traders who take short trades on the breakdown of the anticipate price to keep going down. A fake breakdown (also known as 'Bear Trap') happens when price reverses and starts rising instead of continuing to go down.
At present, the Fakeouts script is meant for identifying fake breakdowns. These are situations where price falls below the support line, but then reverses and starts rising. This will help users to go LONG on such fake breakdowns.
The script identifies breakdowns of the last 40 to 120 candles. The price must close above the high of the breakdown candle within 7 candles of the breakdown to be called a 'fake breakdown'. Users can also set alerts for such fake breakdowns on their chosen scrips. The script works on all timeframes.
The fake breakouts will be added soon to the script.
Access to this script is restricted to users authorized by the author and usually requires payment. You can add it to your favorites, but you will only be able to use it after requesting permission and obtaining it from its author. Contact tradewithpuneet for more information, or follow the author's instructions below.
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