This is how liquidation traps get set up without most noticing. The market lures in the overconfident with a quick spike, only to reverse and wipe out leveraged positions in seconds. I've seen it play out too many times retail jumps on the hype, while the real players sit back and collect. It's not just bad luck; it's designed that way when funding gets skewed and whales hunt stops.
The insight here is spotting those false moves early.
When a coin wicks hard into resistance but volume doesn't follow through, that's your red flag. Traders get emotional, chase the green candles, and ignore the underlying imbalance ending up on the wrong side of a cascade.
Takeaway: Scale in slowly on dips, not highs. Use tighter stops around key levels to avoid the trap, and watch liquidation data like a hawk it tells you where the pain points are building.
Stay sharp out there; these setups can flip a portfolio overnight if you're not paying attention.
$HYPE wicking into overhead supply watch for stop hunts below recent lows.
$DCR pushing a breakout edge liquidity thin, potential trap forming.
$TAO testing funding extremes imbalance could trigger a flush.
