Profitable prop traders use breaks of previous highs and lows to decide whether to ride trends or reverse when there's no follow-through. Stop orders cluster around these levels, creating predictable targets like the previous day's low or a higher low.
Typically what I'm looking for is I'm waiting for one of those highs or lows to be rated and then I'm looking to either, you know, continue the trend lower if we don't reverse initially or if we get, you know, zero follow through, then I'm looking to go the other way and possibly target the previous day's higher low. So if we take out, if we've taken out the high and failed to go higher, now I'm going to start targeting the previous day's low. Right. Because we're just anticipating that all those stops that were above the high get triggered. Okay. So anybody that's short or anybody that's trying to get long is placing their, you know, their order above that. Yeah. High. So this is the previous day. The orders for any shorts will be, you know, in terms of stops will be in this section. Any longs will be in this section. Well, even people that aren't yet in the market might not be a short. That might be a buy stop is.
