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Nikita (SEBI RA)

21st Oct · SEBI-Registered Analyst

Bear Trap – The False Breakdown Setup 🐻🪤

📊 A Bear Trap is the opposite of a Bull Trap — when price breaks below support, triggering panic selling, but then reverses sharply upward. ✅ Key Signs: Breakdown below strong support. Quick recovery within 1–2 sessions closing above support. Volume surge during breakdown & recovery. ✅ Meaning: Retail traders panic-sell, while smart money accumulates quietly. 📌 Example: Stock breaks ₹620 support → hits ₹605 → next candle rebounds and closes ₹625 → Bear Trap → reversal confirmed. 🧠 Tip: If RSI shows divergence and breakdown fails, reversal potential is high.

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