Forex Traders Daily
Trapped Traders Daily Analysis
Lateral Thinking and Stop Hunts
January 5, 2018
Hello traders, Mark Chapman here. I hope you’re well. I’ve got a question on my YouTube channel yesterday about the EURJPY and if I could comment on that. If you guys want me to do something similar, if you’ve got any questions, just ask away in the comments section and I will endeavor to respond to that in the daily videos. So, I hope that is a welcome little new addition. And if I get absolutely bombarded, just bear with me and I’ll do my best to get through them all.
So, this was a question by one of you guys and what it was asking about was if I could look at the EURJPY. So, the EURJPY on a daily chart. It’s actually travelled 200, 207 pips since the breakout. Now, obviously potential manipulation setups can just turn into new price discovery for the said currency and it’s off higher and you don’t get the manipulation. The other reality of a potential manipulation is that a level of support-resistance actually holds and ultimately it never turns into a manipulation either. It would eventually breakdown and, again, you would have something similar to the opposite example.
So, we never know which scenario is going to play out. We can just position ourselves and recognize the patterns ahead of time so that we can be best placed when a manipulation actually does unfold. Now, this might surprise you to hear me say this, but this move could still be a manipulation. I’ve seen manipulations of this ilk before many times, where price goes way beyond most people’s sort of perception of what a manipulation could potentially be.
If you asked anybody. So, the two types of people you would ask is someone who understand manipulations and someone who just thinks about breakouts normally. And if you were to ask either group of those traders whether or not that had broken out, I would suggest most of them would say that it had, but that’s wrong to think that. You’re missing a trick. Part of understanding manipulations, part of being able to trade them and look at the markets in this way, is a requirement for a bit more lateral thinking than what you would normally otherwise sort of see within the normal perception that a trader experiences when looking at a sterile price chart.
It’s absolutely possible that this could start to fail to go up. Maybe breach the highs just to catch those retracement traders and those final breakout traders, and then fail back to the level. Often times you’ll see a bounce and then ultimately boom, you get the manipulation. And as I say, not only would those traders not believe that that wasn’t a breakout, but they wouldn’t believe their eyes if they saw price down in here and selling off from under the underside of that level. The mind won’t bend that far, and that’s what I’m saying.
I’ve seen and traded these many times and it could just be an absolutely monstrous manipulation. And the more convincing this is, the more people are going to pile in long and the more that works in terms of the process of a manipulation. So, yes, there is a point at which it doesn’t. What you couldn’t consider a manipulation. What you’ll tend to see is you’ll see price create a base and a higher level. Something like that, where you get a couple of touches on the either side some higher up or lower down level, and then you ultimately get some type of continuation from there or potentially a manipulation of itself, that new area.
So, that’s what it tends to look like, but this could still turn because it hasn’t created any type of range. It has gone hundreds of pips. It doesn’t look as if it’s going to occur, but it absolutely could. And anybody going long in here, as I say, price would be down in this area. They would be just gob-smacked. Just like what the hell. I thought I was in this super strong breakout and this really nice retracement or whatever, and they’ve been completely and utterly creamed.
So, yeah, very interesting chart. These types of idiosyncrasies about a manipulation or these types of little bits of gems of knowledge – you just get them from years of experience and we’re trying through my channel and through my inner circle to share these golden nuggets with you so that you can start to improve your own trading and your ability to trade traps and manipulations like we do.
So, yeah, this would be your level. So, great level by the way. I mean touched several times. Very, very precise. You get a little bit of entry cheese in here because obviously on the lower timeframe that would be some selling. Really the main part is in here. It seems a little high, but It’s not really because if you draw your level off that top edge, it’s pretty precise. People would start to see some selling in there and they would pull the trigger on that trade, placing their stops above here.
So, above that structure or pretty close to it. Let’s have a look. Let’s clean this up. Yeah, they’d put it above that. This would be the case where they would have to put it above that structure because they’ve got no other choice. These structures are all lower than this swing. They’ve obviously been creamed as price goes up and then obviously you’ve had the break, pullback, break traders.
So, yeah, I mean in terms of just looking at a level, that’s a thing of beauty. It’s a really, really pretty example of what a manipulation, what you want to sort of train your eyes to see. And as I said, whether or not it turns out to be one, who the hell knows? We just position ourselves for those moments when they do occur and then we take those trades.
So, I hope that’s been helpful. And as I say, if you’ve got any other questions you want to ask in the comments section and I’ll do my best to answer them, stick them in the chat. And if you’d like to come and join me in my inner circle, the link is below this video and I’ll hopefully see you in there. Take care. Have a great day.
Forex Traders Daily