Thread by @Anshi_________

HOW TO AVOID FAKE-OUTS and operator's TRAPS

A Thread.

As we all know, after Sebi's new margin rules, no. of fake breakouts has increased...

The most common questions that come to our mind are
- How to avoid fake breakouts?
- How to avoid getting trapped?
- How to get breakout confirmation?
- Buy after breakout or wait for a retest?

Answer. You can't avoid fake-outs most of the time and can't get confirmation as well.

But you do not really need to get confirmations most of the times to make money

Example of Fake-breakout below.
This is where most of us make losses

Now let's go back and check how many entry points we got

The pattern provided 4 profitable entries and if you buy only , then 2 good entries

Even if you buy and sell the Support Resistance, there were 4 profitable entries.

What about the Fake Break-out?
You would have lost most of the money there, right?
You got trapped by a fake-out.

Now , See
- The operators can and will trap you.
- Fake-breakouts and Traps happens and will happen..Your goal is to save capital to sustain

Question is, How?

- You need to know when the trade goes against you.
- Exit when it goes wrong, your view has negated
- Admit that it was a trap. Take the loss and move on.

YOU will lose big only when you don't exit when your view is negated

Having a plan B when plan A fails is mandatory.

-If the marker gives so many good trades, why should one bad trade ruin big?
-Fake-outs are common and common things shouldn't make you big loss
-If you have a fixed negation and SL, you would survive after getting trapped as well
-Once market enters into consolidation ,

There is very less chance for breakouts to give instance gains.
-You should know to make money selling at resistance as well..

Now a thread on - how to Increase your conviction on Confirmation using volume and rsi coming up soon.