Trapped Traders
Order Flow Analysis glossary · Absorption, Exhaustion & Imbalances
Definition
Participants who entered a position at a price extreme — near the high or low of a bar — that immediately reversed against them, leaving them in a losing position. Their urgency to exit creates additional order flow in the direction of the reversal, which amplifies the move and traps further participants from lower-quality entries — a self-reinforcing feedback loop. Trapped buyers are identified by a buying imbalance at a bar's high followed by a bearish close; trapped sellers are the mirror at a bar's low followed by a bullish close.
Trapped Traders in plain English
Trapped traders are people who jumped in right at the top or bottom of a price bar, only to watch price instantly whip the other way — now they're underwater and stressed. To stop the bleeding they have to bail out, and bailing out means firing orders in the SAME direction price is already moving, which shoves it further and snares even more late-comers — a snowball. Think of buying concert tickets at peak scalper prices seconds before the price crashes; your panic-selling only drives the price down faster. You spot trapped buyers as aggressive buying at a bar's high that then closes lower, and trapped sellers as the mirror image at a bar's low that closes higher.
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