"FAKE BREAKOUTS" or is your broker stop hunting???
You have been watching a chart for some time now and price is at a key level of support and resistance. You are waiting for a breakout. Finally you see price preaching and you jump in with a trade. Only to see price quickly reverse and hit your stop. It is a very frustrating market event and can be costly to your account. What is a "Fake Breakout"??
Definition:
A situation in which a currency pair, stock or index closes above or below a range defined by a short-or long-term trend line or other support or resistance level and then retracts to within the range again. False breakouts can take place for any number of reasons, including a response to news or from professional traders who are probing areas where they believe a number of stop orders may have been placed. So there is a short and sweet definition to "Fake Breakouts".
The latter part where it is a fact that large traders, (institutional traders) are not necessarily hunting for your trade stop loss but, they in fact are positioning themselves for a better price. and by doing so they are hitting your stop loss. Lets look at a chart of a "Fake Breakout".
It is clear where we had an appearance that price was going to breakout of the range to the downside only to quickly reverse and move to the upside taking out many traders that quickly dived in when they saw price preaching the lower range bands. We have all been caught by this. Why?? we were not properly trained to spot "Fake Breakouts." and how to trade them. I posted that there would be a Free Webinar on how to spot and trade this very common market event. So here is the link.
This is where I learned to Spot, and Trade the "Fake Breakout". Enjoy and let me know what you think. And of course this is free. This is some very powerful stuff.
Free webinar provided by Hector Deville and Forex Knights
Definition:
A situation in which a currency pair, stock or index closes above or below a range defined by a short-or long-term trend line or other support or resistance level and then retracts to within the range again. False breakouts can take place for any number of reasons, including a response to news or from professional traders who are probing areas where they believe a number of stop orders may have been placed. So there is a short and sweet definition to "Fake Breakouts".
The latter part where it is a fact that large traders, (institutional traders) are not necessarily hunting for your trade stop loss but, they in fact are positioning themselves for a better price. and by doing so they are hitting your stop loss. Lets look at a chart of a "Fake Breakout".
It is clear where we had an appearance that price was going to breakout of the range to the downside only to quickly reverse and move to the upside taking out many traders that quickly dived in when they saw price preaching the lower range bands. We have all been caught by this. Why?? we were not properly trained to spot "Fake Breakouts." and how to trade them. I posted that there would be a Free Webinar on how to spot and trade this very common market event. So here is the link.
This is where I learned to Spot, and Trade the "Fake Breakout". Enjoy and let me know what you think. And of course this is free. This is some very powerful stuff.
CLICK THE LINK BELOW AND LEARN TO START TRADING THE "FAKE BREAKOUT"
Free webinar provided by Hector Deville and Forex Knights
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