TRADERS BEWARE! -- Possible stop hunt
I have already entered a short last week at the peak of the daily tf retracement, but here is an idea if some traders have missed out on an entry.
As you can see price bounced off the upper bounds of the daily tf channel with an RSI divergence. A cup and handle pattern appeared and there was a massive bearish engulfing candle that broke out of the CnH pattern.
It is possible that aggressive traders have entered shorts immediately once it broke down and placed their stops above the handle. Those retail trades are easy money for institutions and hedge funds to gobble up by pushing price past that red liquidity zone before entering their own short positions.
Once that happens, I will hop on the bandwagon.
What do you think about this idea?
As you can see price bounced off the upper bounds of the daily tf channel with an RSI divergence. A cup and handle pattern appeared and there was a massive bearish engulfing candle that broke out of the CnH pattern.
It is possible that aggressive traders have entered shorts immediately once it broke down and placed their stops above the handle. Those retail trades are easy money for institutions and hedge funds to gobble up by pushing price past that red liquidity zone before entering their own short positions.
Once that happens, I will hop on the bandwagon.
What do you think about this idea?
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