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Fakeout

Bitcoin's Quiet Before the Storm 🌊Ever noticed when the Bitcoin chart goes eerily quiet? It's like a still lake before a storm. But here's the scoop: this tranquility might not be innocent. In fact, it could be orchestrated by bigger players in the game. Enter the whales – major market influencers. When they create low volatility by steadying prices, it can make others think nothing big is coming. People start selling, thinking the party's over. And that's when the whales strike. By triggering a sudden price surge, they catch sellers off-guard and reap rewards. It's like pretending a movie's dull to empty the theater before revealing the epic climax. Remember, appearances can deceive. Low volatility might mask a grand plan . Stay cautious, stay informed. Don't exit too soon and miss the show. In crypto's realm, the still waters can hide a tempest. Stay sharp
INDEX:BTCUSDLong
by AlexWhale
What are Fakeouts, Shakeouts and Whipsaws?Let's get straight into the three cronies of trading disaster when taking and holding a position. Fake-out: (When the price makes a false breakout of a chart pattern) A fake-out occurs when the price of a market appears to break out of a certain chart pattern. This could be a trendline, support, or resistance level. But then quickly reverses and retreats back within the pattern. Shake-out: (Where the market is highly volatile and the price moves to levels that hits their stop losses and gets traders out of their trades) A shake-out is a scenario where the market becomes highly volatile and the price moves rapidly to levels that trigger the stop-loss orders of many traders. Stop-loss orders are pre-set risk levels at which traders automatically exit their positions to limit their losses. A shake-out is designed to "shake out" weak or inexperienced traders from the market. When stop-loss orders are triggered, it can create a temporary spike in the opposite direction of the prevailing trend. Once these traders are "shaken out," the market might resume its original trend. You’ll see this most commonly with low liquid, high volatile markets like Penny Stocks or Penny Cryptos. Whipsaw: (This is where the market will change its most prominent direction within the day). Whipsaw refers to a situation where the market quickly changes its direction within a relatively short period, often during a single trading day. This can cause confusion and losses for traders who are caught off-guard. Whipsaws can occur due to various factors, such as sudden news releases, economic data surprises, or changes in sentiment. They are characterized by sharp price movements that can make it difficult to make accurate trading decisions. Whipsaws are especially common during periods of high market uncertainty or when there's a lack of a clear trend. Let’s create a quick summary of the three: Fake-out: (When the price makes a false breakout of a chart pattern) Shake-out: (where the market is highly volatile and the price moves to levels that hits their stop losses and gets traders out of their trades) Whipsaw: (This is where the market will change its most prominent direction within the day).
JSE:J200Education
by Timonrosso
How to trade Fake Breakouts in the range Range trading, characterized by price oscillations within defined support and resistance levels, offers traders a structured approach in sideways markets. However, even within these stable waves, deceptive price movements known as fake breakouts can occur. These false signals can lead traders astray if not properly recognized and managed. In this article, we'll delve into the world of fake breakouts within range trading, equipping you with strategies to identify and navigate these misleading market dynamics. Understanding Fake Breakouts: A fake breakout occurs when price seemingly breaches a support or resistance level but quickly reverses back into the established range. These deceptive moves often trigger stop-loss orders and entice traders into taking positions in the direction of the apparent breakout, only to experience a sudden reversal against their trades. Fake breakouts are fueled by market manipulation, emotional trading, or sudden news events. Here are few examples of fake breakouts in big Time-frames : Often, this is not enough for entering a position. Combine this with divergences on RSI or other factors for entry. Key Characteristics of Fake Breakouts: Swift Reversal: A true breakout sustains its direction, while a fake breakout swiftly reverses back into the range. High Volatility: Fake breakouts often coincide with spikes in volatility due to market confusion and emotional reactions. Trapped Traders: Traders who entered positions based on the fake breakout are "trapped" when the market reverses, leading to potential losses. Navigating Fake Breakouts: Confirmation Through Candlesticks: Wait for candlestick confirmation beyond the breakout level. A close above resistance or below support lends greater credibility to the breakout. Increased Volume: Look for a surge in trading volume accompanying the breakout, indicating genuine market participation. Use of Indicators: Rely on technical indicators like the Relative Strength Index (RSI) or Moving Average Convergence Divergence (MACD) to validate breakout momentum. Strategies for Trading Fake Breakouts: False Breakout Reversal: Enter positions in the opposite direction of the fake breakout when price returns to the range, targeting a retracement towards the opposite boundary. Wait-and-Watch Approach: Allow the breakout to develop and wait for confirmation before entering a trade, avoiding pre-mature positions. Risk Management When Dealing with Fake Breakouts: Tight Stop-Loss: Set a tight stop-loss order beyond the breakout point to limit potential losses if the breakout reverses. Position Sizing: Allocate a smaller portion of your capital to trades involving potential fake breakouts due to the increased risk. Pros and Cons of Trading Fake Breakouts: 👍 Pros: Opportunities in Deception: Skilled traders can capitalize on market deception by trading against fake breakouts. Enhanced Risk Management: Proper identification of fake breakouts allows traders to minimize losses through tight stop-loss orders. 👎 Cons: Increased Complexity: Identifying fake breakouts requires additional analysis and indicators. Risk of Mistakes: Mistaking a genuine breakout for a fake one or vice versa can lead to missed opportunities or losses.
Education
by Yaroslav_Krasko
Gold long idea Based on the weekly market structure the following statements can be made: - Following the previous 3 week's trend, we are looking at a classic market maker dump&pump scheme. 1) price is dropping on Monday and thuesday. 2) On Wednesday price normally makes a fakeout to the downside, trapping breakout traders 3) Market makers pump prices to the opposite direction on thuesday, collecting the liquidity from the trend. We have 5 confluences for bullish price action: 1) Price touched a 4h orderblock 2) Price broke below a previous low, creating a discounted price on Wednesday. 3) price created a triple wick rejection with bullish engulfing candle on the 1h chart 4) We have trapped volume from wednesday's New York session 5) selloffs are bought back instantly (seen on the 5m chart) Trade wisely, Peter
CAPITALCOM:GOLDLong
by peti199
ETHUSDT ASCENDING TRIANGLEI'm sorry but the target does not fit in to the chart. As you can see, the overall situation in the crypto market is not looking very healthy, We have here a very simple setup, we combine: - RSI Bearish divergence. - Uptrend with decreasing volume. - Failure to break major resistance of 2000$. - Bitcoin selling at less than 25000$. And for the previous reasons, I would consider opening a short here with targets 1370$ 890$ and 285$ (high before 2020 market crash). For entering, there is various options, you can enter now or wait for a confirmation like for example, the breakdown of the trend-line and a retest. This trend-line is acting as a strong support so It might take a few days to see a breakout, however, this setup can be wrong, nothing is infallible, no trader wins 100% of the time so please, remember that the first thing is to protect your capital. It's recommended to set a stop loss at 1790$.
Short
by piccard54
2
Fake Breakout / Fakeout BTC 🔄This view of BTC comes from a background of Price action trading. Trading Fakeout's are quite common in the Forex market and have proven to be a cornerstone of my Trading Strategy. Fakeout's occur on all timeframes and take the market for an unpleasant ride. Traders Buy the breakout or in this case Short the breakout hoping to jump on the train and continue to lower prices. The liquidity that is generated is consequently used by large players to 1) Scale out of their short positions and 2) To gradually accumulate opposing orders ( In this case Buy orders ) Fakeout's are not hard to anticipate and are somewhat similar to trading support and resistance levels. The only difference being the sequence in which the market sets itself up prior to the support and resistance bounce. In this case we can observe that the price on the Daily timeframe has been bouncing between 26,400$ and 27,400$ since May 12. Price recently closed quite the bearish candle on June 5th ; closing outside of our previously mentioned range. A good Risk/Reward idea suggests that we may bounce from the bottom of the range.
COINBASE:BTCUSDLong
by ShrewdCatfx
My EURCHF short setup - 100 pips profitHow I took this trade I found this setup while strolling on the EURCHF chart. I saw it was consolidating between 0.97600 (resistance) and 0.97230 (support). Based on this, I drew a consolidation zone and waited for a fakeout, which happened before the market closed on Friday. It had a little fakeout of around 1-2 candlesticks on the 1H chart. From this little fakeout, it moved back to the zone, touched it, and then a bearish trend continued, as the fakeout suggested. When I entered and exited my position I entered my position when I saw that the bearish trend continued after it retraced to the zone. From there on, I held it till 0.97099, sold 50% of my position, and then sold the other 50% at 0.97074. Question for the readers: how can I hold this trade longer (see where it went), and where do I take my profit? Jasper
Short
by JBod03
Fakeout. Short term targets btcOK so a little breakdown from What I'm seeing short term. The yellow hand drawn circle is a brilliant example of a fakeout. We recently broke down from a equal triangle shape after a fakeout (fakeouts are usual signs of reversal coming) The target for breaking down from this triangle would be about 27900. As shown by simple cloning the high to low of the beginning of the triangle. 27900 also brings us to out support zone again (red dashed horizontal) Happy Bank Holiday 🍻
COINBASE:BTCUSDShort
by Connix
EURJPY 💶/💴The Daily candle just closed at 147.58. This price was our previous Daily Level. Price is still technically in a range between this price and 146.71. After spiking up to previous Monthly High at 148.4, we rejected those extreme prices and came flying back down into the current range right now. Price may continue bearish from here and we can call it a Fakeout as price failed to stay above 147.58 Daily level initially. Returned back into the range, tocuhed bottom of range, now price is coming back up for a last retest before returning back to the bottom of the range at 146.71.
Short
by ShrewdCatfx
Up during Asian. Retrace during London? 🗞️We have creased yesterday's daily high at 1.10678. There is liquidity above this high. Especially since we have run up so far and therefore probabilities suggest we will pullback for liquidity for London Open. If we go up , then we will fly because there is clean traffic to the left. The 4hr is quite clean up to 1.1158. The 1Hr is clean up to 1.1125. Either way we must be prepared. I like pullback to clear out fomo buyers above yesterday's daily high back to 1.1057 for liquidity. Price has gone up so far and has exceeded our weekly target at 1.103. The market is oftern irrational and can be so longer than we as traders can stay solvent. Safe trading.
Short
by ShrewdCatfx
Gold fakedout traders why ???hello traders here i will explain why people get faked out the market do same thing over and over again every time we should try to learn and see what the chart is saying and the mechanics behind how a trade setup form them selves i have outlined for breakout traders how they can avoid being faked out all the time ...comment down below and follow for more also give it a like if you find it helpfull we will have trade gold 2morrow stay up
BLACKBULL:XAUUSDLong
by UnknownUnicorn11253106
3
USDCAD Study Case 🧙‍♂️Intuition suggests price is likely to flow back up to the main weekly supply to clear out seller liquidity. How we will get to that zone is another story. I don't think we will push up to the zone from here. I believe price has lured buyers in after breaking the trendline marked. So price is likely to do some manipulation to clear breakout buyers before flowing to our target. I have done a rough illustration of what I am after but we will have to judge it as the price progresses. I am wishing you all a fantastic trading week team!
Long
by AlkalineFX
9