Here is how you can plan your trade setups or you can also call it different trade strategies.
Plan 1: Sharp move up and Reversal/Pullback
How it looks like? A sharp rally followed by a sudden spike and then a steep drop.
How it happens?
• FOMO buying pushes price rapidly up.
• Smart money sells into that strength.
• Price quickly reverses and breaks below support.
How to trade?
• Avoid buying the spike.
• Look for price to return to previous demand/support levels.
Plan 2: Consolidation then Breakout
What it looks like?
A strong move up, then sideways or consolidation, followed by a breakout.
Why that happens?
• Market is cooling off and accumulating.
• Buyers and sellers shakeout within the range.
• Breakout suggests fresh buying momentum.
How to trade?
• Watch for breakout from the consolidation zone.
• Buy the breakout or the retest.
This Ideal setup for trend continuation trades.
Plan 3: Breakout and Retest
What it looks like?
Price breaks above resistance, pulls back, and retests the breakout level.
How that happens?
• Initial breakout occurs.
• Traders take profit, causing a pullback.
• Buyers defend the breakout level (new support).
How to trade?
• Buy the successful retest (when price holds above previous resistance).
• Safer than buying the breakout itself.
• Often leads to a strong continuation.
Good luck & Keep Learning
