medium · Volume Price Analysis
How does a 'Spring' formation at a support level function as a trap for retail traders?
- It pushes above resistance to trigger buy-stops, which insiders use to exit their long positions.
- It is a low-volume move that confirms the breakdown of support will continue rapidly.
- It pushes below support to trigger sell-stop orders and shake out weak holders before insiders buy and reverse the price.
- It indicates that the insiders have completely withdrawn from the market, leaving price to drift.
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