How to trade with Bull trap trading strategy
The Foreign exchange market is an outstanding market when trading with such market the traders should execute their plan perfectly. The bull trap trading strategy is one of the price actions trading strategy used to trade the market. Do you know the meaning of bull trap? Do you know the types of bull trap charts? If you know very little about the Forex market then you are not eligible to remain in the market. Did you know that Forex market is highly competitive? The Forex market is highly competitive so you should be up-to-date with the market information. If you are not up-to-date then you will be able to trade like a pro. Let us learn the trading methods to make you more knowledgeable about the Forex market.
What is a bull trap strategy
A bull traps mean which happens when the trader takes the long position in a reliable setup and then the price moves down very snippily. Most of the novice traders are the victim of this setup but the professional traders can easily spot this bull trap in their professional trading platform. If you truly want to become a professional trader than its highly imperative that you trade with the professional trading platform since it will help to do better technical analysis.
Most of the novice trader are trapped by the long position and the bullish signals so that is why this is called the ‘trap’. The bull trap usually occurs around the previous high because the price continues to rally. The naïve traders would enter such trades too early because they are not aware of the market. It is dangerous to trade in such situation because even though the prices rally if the prices reverse then you must hold on to bigger losses. If the price keeps moving in the opposite direction the losses become huge until the trader quits the trade. When you trade the Forex market it is essential to analyze it perfectly. Before you execute any trades in the market make sure that you do the fundamental and sentiment analysis along with the technical analysis. By doing so you will be able to save yourself from lots of false reliable signals in the market.
Two great ways to trade when “trapped“
As trapped traders, you should understand that the dynamics of bull traps. The bull traps are the profitable and reliable reverse signals. You can take better decisions and you can trade against the losses. We will give you two great ways to trade in such situation; the first great way is that you should do the technical analysis before you trade; you should not be too early or too late to trade. The second great way is that you should trade in short after the bull trap.
Types of bull traps
Now, you will be able to understand the bull trap strategy and its dynamics. The bull traps come in different forms they are such as the double top squeeze (two swing points), the gap squeeze, the range squeeze, and the pin bar squeeze. You should have the knowledge of the types of bull traps because if you are in the market you will have to face it. The best way to identify the bull traps in the market is by learning the different chart patterns and price action confirmation signal. If you look at the professional traders than you will see that most of them are able to save themselves from the bull traps since they know the reliable chart patterns in the market. But even after that if you are victim of the bull trap don’t be late execute short orders in the market.
Summary: the bull trap strategy is not the main system in the market but still, you should have the understanding of the dynamics of it. When you are in the Forex market you should understand that there is another end when you trade. If you are selling then there is a buyer and f you are buying there is a seller. So you cannot do it easily, you should be attentive in Forex trading. The trap traders can trade the market with the help of our article.