Here’s a simple breakdown of different ways to approach your trading setups or strategies:
**Strategy 1: Sudden Surge Followed by Drop**
What it shows: A quick upward run, a sharp peak, then a fast decline.
Why it happens:
• Intense buying out of excitement pushes the price higher.
• Bigger players sell during the hype.
• Price drops quickly, falling below earlier support.
How to handle it:
• Don’t enter during the peak.
• Wait for price to revisit earlier zones of interest.
**Strategy 2: Pause Before the Climb**
What it shows: Strong initial rise, then flat or tight movement, then another upward push.
Why it happens:
• Market takes a breather and builds up.
• Movement within the range helps shake off weak positions.
• A breakout indicates fresh interest from buyers.
How to handle it:
• Keep an eye on the top of the range.
• Consider entering on the break or once it comes back to test the zone.
This is great for riding the existing direction.
**Strategy 3: Break Then Bounce**
What it shows: Price goes through a ceiling, then pulls back and touches that level again.
Why it happens:
• Price moves past a barrier.
• Some traders exit with gains, causing a dip.
• New support is formed at the previous barrier.
How to handle it:
• Step in when price proves it can stay above the previous ceiling.
• This is often more reliable than jumping in on the break itself.
• Can lead to a strong follow-through.
Best wishes on your trading journey — keep building your skills!