Is the current pattern a price trap? 🤔🤔
Price traps (Liquidity Traps) or moving against the general expectation (Stop Hunt).
When a well-known technical pattern forms (like head and shoulders, double bottom, or triangle...), a large percentage of traders have the same expectation, and often:
They enter buy or sell positions based on the pattern.
They place stop loss orders below or above clear areas.
They have greed or excessive confidence in the realization of the pattern.
Here, the market maker (or big liquidity) intervenes:
🔁 Temporarily reverses the trend against the expectation, to:
Liquidate traders' positions.
Hunt stop orders.
Collect cheap new liquidity.
Then the price returns later to the "true" direction.
Was Bitcoin supposed to drop due to the formation of head and shoulders, and did market makers push the price up to hunt stop losses and liquidation positions??.
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