Be careful ❗️📈
A **bull trap** is a false market signal that suggests a rising trend in a financial asset, such as stocks or cryptocurrencies, is about to continue, but instead, the price reverses sharply downward. Traders who believe the upward trend will persist buy the asset, expecting to profit as prices continue to rise. However, when the price suddenly drops, these traders are "trapped" in a losing position.
Bull traps often occur after a brief rally in a bear market or during a period of market consolidation, where the price briefly moves upward, luring in buyers before it reverses and continues downward. Recognizing a bull trap can be difficult, as it often involves analyzing price patterns, volume, and other market indicators.
