Traps – This One Needed Patience

 

It seems that most of the examples of market traps which I've shared over the years, were all traps which trigger very quickly.

We all like the quick ones. They're easy. Like this one:

Traps - They don't always play out straight away!

See here for the TST, BOF & BPB Setups.

Let's see what happens as price breaks the swing high at C:

Traps - They don't always play out straight away!

And the outcome:

Traps - They don't always play out straight away!

Interestingly, had I not been trading this trap opportunity, would I perhaps have seen the even better one that followed immediately after?

Traps - They don't always play out straight away!

We all love the traps that trigger quickly and move immediately in the positive direction. 

But traps don't always spring quickly.

Sometimes they require a little patience.

Sometimes they play out slowly.

Like this one which occurred a bit later:

Traps - They don't always play out straight away!

Traps - They don't always play out straight away!

Traps - They don't always play out straight away!

Traps - They don't always play out straight away!

Traps - They don't always play out straight away!

Traps - They don't always play out straight away!

Traps - They don't always play out straight away!

Traps - They don't always play out straight away!

Traps - They don't always play out straight away!

Traps - They don't always play out straight away!

Traps - They don't always play out straight away!

When a trap doesn't trigger straight away, be patient.

Price action can still provide the shock necessary to trap the other market participants.

Remain alert.

And as always… keeping assessing the price movement from the perspective of "the other trader" and their fears, their hopes and their dreams.

Know your enemy! Strike when they're weakest.

Happy trading,

Lance Beggs

 


 

Written by

YourTradingCoach - Admin

2 Comments to “Traps – This One Needed Patience”

  1. Mahesh. says:

    Hi Lance,
    in the third chart on this page, you mentioned “slippage”. I didnt understand it in the context of the chart. Please explain.

    Regards
    Mahesh.

    • Lance Beggs says:

      Hi Mahesh,

      There are times and places when you shouldn’t be surprised if you get a tick or two slippage (assuming entry via a market order, or stop market order). One of these is in very fast momentum conditions. Another is on break of a very obvious and well defended level. Another (as shown in this chart) is when entering right at the point at which a trap is sprung. Slippage may be on the full position. Or just partial position. I never like it. But it’s just part of the game. The only option to avoid it is to use a limit order (or STOP LIMIT). But that incurs the risk of no fill at all, or just a partial fill. So if we’re entering at a location or time that has potential to offer slippage, we need to decide which of the two options we prefer. Or which we most wish to avoid.

      Cheers,
      Lance

Leave a Reply

Message

Please prove you're a person: Time limit is exhausted. Please reload CAPTCHA.