📌 3 Key Trade Setups Every Trader Should Master

Whether you're building a new strategy or sharpening your entries, understanding these setups can greatly improve your trading precision:

📈 Setup 1: Sharp Pump, Then Dump

Pattern:

A sudden spike upward followed by a fast and steep drop.

Why it happens:

FOMO buyers rush in, driving price up quickly

Smart money sells into the rally

Price crashes below key levels

How to trade it:

Avoid chasing the top

Wait for a pullback to a solid support or demand zone before considering entry

🔄 Setup 2: Consolidation Before Breakout

Pattern:

A strong move upward pauses into a sideways range, then breaks out again.

Why it happens:

Market cools off and builds strength

The range clears out weak hands

Breakout confirms trend continuation

How to trade it:

Watch the range limits closely

Enter on breakout or a clean retest

Ideal for catching trend continuations

🔁 Setup 3: Breakout with Retest

Pattern:

Price breaks through resistance, then pulls back to test the breakout level.

Why it happens:

Breakout sparks profit-taking

Price retests the breakout zone, now acting as support

Buyers step in, reinforcing the new trend

How to trade it:

Look for a solid retest and bounce before entering

Often safer than entering the breakout directly

Can lead to strong follow-through moves

🎯 Final Tip:

Focus on how price behaves — not just indicators. These setups repeat often, and mastering them can significantly level up your trading skills.

Stay disciplined and keep learning.

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