Kardec Trader explains how traders get caught in liquidity traps when sellers enter around prior highs and liquidity gets run. He shows where to place buy entries to catch the move back up instead of getting trapped.
Once price comes up here and we start creating this high, what's happening here is when we travel to the upside and we're coming into this level of liquidity again that we want to see ran eventually, look how we are respecting it and then the market starts to retrace. Now, this is what I call engineered liquidity. This is sellers entering the market here, this high here, respecting highs to the left-hand side. So then typically what happens in the market will retrace. Now, typically I want to be buying down here, my entry would be here, and then we're going to look for that move back up to the upside.
