My trading strategies : Trade against the trapped trader!
STRAT 11 : Basic premise
As price continues in a trend, more and more traders keep piling into the same direction, hoping that the trend will continue and they will make money. However, at some point, the trend sharply reverses, breaking the market structure in opposite direction and trapping a whole bunch of retail traders in the direction of trend which just got reversed.
We create a zone which identifies these trapped traders and then patiently wait for them to exit, and trade with limit orders in the direction of their exit.
You can add additional confirmation signals from DXY's directions for the instruments which are highly correlated to DXY (EURUSD, USDCHF, etc)
As price continues in a trend, more and more traders keep piling into the same direction, hoping that the trend will continue and they will make money. However, at some point, the trend sharply reverses, breaking the market structure in opposite direction and trapping a whole bunch of retail traders in the direction of trend which just got reversed.
We create a zone which identifies these trapped traders and then patiently wait for them to exit, and trade with limit orders in the direction of their exit.
You can add additional confirmation signals from DXY's directions for the instruments which are highly correlated to DXY (EURUSD, USDCHF, etc)
