Market Structure Observation: Fakeouts are common, not because the charts are misleading, but due to liquidity concentrating at obvious levels.
1. The more traders eye the same resistance level, the easier it is for a breakout to trigger FOMO and stop-loss orders.
2. If the breakout doesn’t see increased volume afterward, the risk is that price returns to the range.
3. To assess the quality of a breakout, you need to check how long it holds above, not just the first candlestick.
Invalidation Condition: Price returns to the range and fails to reclaim the breakout level.
Are you more afraid of fakeouts, or missing a genuine breakout? #BTC #TradingPsychology
1. The more traders eye the same resistance level, the easier it is for a breakout to trigger FOMO and stop-loss orders.
2. If the breakout doesn’t see increased volume afterward, the risk is that price returns to the range.
3. To assess the quality of a breakout, you need to check how long it holds above, not just the first candlestick.
Invalidation Condition: Price returns to the range and fails to reclaim the breakout level.
Are you more afraid of fakeouts, or missing a genuine breakout? #BTC #TradingPsychology