When trading most of us entry our trades TOO EARLY. Ofcouse we don't want to miss the opportunity to make money. This is one of us basic fear and its called "fear of missing out" Everybody knows this fear but we still feel it. And it is not just trading. You feel it when your friends go out and they did not invite so you feel miserable and left out. So its natural and I struggle with it myself everyday too. The thing you gotta understand is that the "SMART MONEY TRYES TO TRAP YOUR TRADES" using your fear of "fear of missing out".
For example you can see in the chart the circles that I marked when doing my backtest. See Theres normally some type of keylevel like support zone that the price touches. Everyone is expecting that the price is going to bouce after touching the support zone which it does. But before that the price breaks the support zone slighly and traps everyone to get more liquity to the trade. They dont do that to just bully you they do it because they need more contracts to buy and if peapol think its a bear breakout theres a lot contracts for good price to buy. They just try to hedge they position and get the best Risk Reward ratio. You know that feeling when the trade feels perfect and the you get wicked out. I know bro it hurts.
So how can we avoid these LIQUITY TRAPS?
The Markets always tests your patinece in situations like this. But i get that you cant be just patient to make money in the markets because if you have too much confirmation your probably late and if you have too little confirmation your probably in a risky situation. Everyone struggles with this and theres no one right answer. But what i can suggest you to do is wait for the VOLUME GRAB and then entry your trades. Then theres bigger chance to a winnig trade and it will be easier to trade when i dosen't give you mixed signals.
When Trading
1) Be patient
2) Wait for the volume crab
3) Get the confirmation that your strategy needs
Im trying to build a trading strategy to this specific relying on these "Smart Money Traps". So Follow if you wanna see the future UPDATES!
For example you can see in the chart the circles that I marked when doing my backtest. See Theres normally some type of keylevel like support zone that the price touches. Everyone is expecting that the price is going to bouce after touching the support zone which it does. But before that the price breaks the support zone slighly and traps everyone to get more liquity to the trade. They dont do that to just bully you they do it because they need more contracts to buy and if peapol think its a bear breakout theres a lot contracts for good price to buy. They just try to hedge they position and get the best Risk Reward ratio. You know that feeling when the trade feels perfect and the you get wicked out. I know bro it hurts.
So how can we avoid these LIQUITY TRAPS?
The Markets always tests your patinece in situations like this. But i get that you cant be just patient to make money in the markets because if you have too much confirmation your probably late and if you have too little confirmation your probably in a risky situation. Everyone struggles with this and theres no one right answer. But what i can suggest you to do is wait for the VOLUME GRAB and then entry your trades. Then theres bigger chance to a winnig trade and it will be easier to trade when i dosen't give you mixed signals.
When Trading
1) Be patient
2) Wait for the volume crab
3) Get the confirmation that your strategy needs
Im trying to build a trading strategy to this specific relying on these "Smart Money Traps". So Follow if you wanna see the future UPDATES!
