Here is how it works:
- Retail traders cluster stops at obvious levels (round numbers, previous highs/lows)
- Algorithms detect this liquidity
- Price spikes to grab those stops
- Then reverses back
How to avoid it:
- Use Volume Profile for real support/resistance
- Place stops beyond institutional nodes
- Wider stops with proper position sizing
Free tools: https://blog.quant-view.xyz/tools/?utm_source=devto
Join our community: https://t.me/GFIL_Trading
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