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Bull Trap, failed bull breakout. ''Watch out for possible bull traps when:'' | |||
* '' | * ''price is around EMA, even sometime there is a strong rally rushing to EMA in 2 or 3 bars after gap down, example of [[20230124]].'' | ||
* ''3 CCBLB that looks strong, but bars have '''prominent tails'''.'' | * ''3 CCBLB that looks strong, but bars have '''prominent tails'''.'' | ||
* ''market reverse quickly right after the stop order is filled (1 or 2 ticks above the signal bar)'' | * '''''market reverse quickly right after the stop order is filled''' (1 or 2 ticks above the signal bar).'' | ||
== ''Example Common bull traps'' == | == ''Example Common bull traps'' == | ||
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* ''bars have tails and overlapping though 3+ CCBLB, see bar 3 and 4. 5 will be a better BTC when 3/4/5 all only have small tails.'' | * ''bars have tails and overlapping though 3+ CCBLB, see bar 3 and 4. 5 will be a better BTC when 3/4/5 all only have small tails.'' | ||
* ''if bought above 5, the stop should be below 5 at least for half of the position. '''As a general rule, put the stop right below the signal bar no matter where you entered, at least for half of the position, because that is a sign that market is doing the opposite of what you want.''''' | * ''if bought above 5, the stop should be below 5 at least for half of the position. '''As a general rule, put the stop right below the signal bar no matter where you entered, at least for half of the position, because that is a sign that market is doing the opposite of what you want.''''' | ||
[[File:20230124pa.png|none|thumb|799x799px]] | |||
[[Category:Traps]] | [[Category:Traps]] |